area handbook series 

Indonesia 

a country study 




Indonesia 

a country study 

Federal Research Division 
Library of Congress 
Edited by 
William H. Frederick 
and Robert L. Worden 




On the cover: A two-masted pinisi — a modern adaptation of 
traditional Indonesian watercraft. Based on photography by 
Tim Hornby and with permission of Explore Worldwide, 
Farnborough, Hampshire, United Kingdom. This artwork 
and the images used on the chapter title pages were chosen to 
represent the diversity of watercraft used in the archipelagic 
waters of Indonesia. 



Sixth Edition, First Printing, 2011. 

Library of Congress Cataloging-in-Publication Data 

Indonesia: a country study / edited by William H. Frederick and Robert L. 
Worden. ~ 6th ed. 
p. cm. 

Includes bibliographical references and index. 

ISBN 978-0-8444-0790-6 (alk. paper) ~ ISBN (invalid) 978-0-8444-9503-3 
(alk. paper) 1 . Indonesia. I. Frederick, William H. II. Worden, Robert L. III. 
Library of Congress. Federal Research Division. 



authenticity. Use of the ISBN 978-0-8444-0790-6 is 
for U.S. Government Printing Office Official Editions 
only. The Superintendent of Documents of the U.S. 
Government Printing Office requests that any printed 
edition clearly be labeled as a copy of the authentic 
work with a new ISBN. 



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ISBN 978-0-8444-0790-6 



Foreword 



This volume is one in a continuing series of books prepared by the 
Federal Research Divison of the Library of Congress under the Country 
Studies/Area Handbook Program, formerly sponsored by the Depart- 
ment of the Army and revived in FY 2004 with congressionally man- 
dated funding under the sponsorship of the Joint Chiefs of Staff, 
Strategic Plans and Policy Directorate (J-5). 

Most books in the series deal with a particular foreign country, 
describing and analyzing its political, economic, social, and national 
security systems and institutions, and examining the interrelationships of 
those systems and the ways they are shaped by historical and cultural fac- 
tors. Each study is written by a multidisciplinary team of social scientists. 
The authors seek to provide a basic understanding of the observed soci- 
ety, striving for a dynamic rather than a static portrayal. Particular atten- 
tion is devoted to the people who make up the society, their origins, 
dominant beliefts and values, their common interests and the issues on 
which they are divided, the nature and extent of their involvement with 
national institutions, and their attitudes toward each other and toward 
their social system and political order. 

The books represent the analysis of the authors and should not be 
construed as an expression of an official U.S. government position, pol- 
icy, or decision. The authors have sought to adhere to accepted standards 
of scholarly objectivity. Corrections, additions, and suggestions for 
changes from readers will be welcomed for use in future editions. 

David L. Osborne 
Chief 

Federal Research Division 
Library of Congress 
Washington, DC 20540-4840 
E-mail: frds@loc.gov 



iii 



Acknowledgments 



This edition supercedes Indonesia: A Country Study, published in 
1993. The authors wish to acknowledge their use of portions of that 
edition in the preparation of the current book. 

Various members of the staff of the Federal Research Division of 
the Library of Congress assisted in the preparation of the book. Sandra 
W. Meditz made many helpful suggestions during her review of all 
parts of the book and managed the editing and production of the book. 
Catherine Schwartzstein edited the manuscript, made many very useful 
suggestions, and helped clarify obscure points. She also performed the 
final prepublication editorial review and compiled the index. Vincent 
Ercolano also edited parts of the manuscript in its early stages. Sarah 
Ji-Young Kim provided valuable assistance in checking facts, review- 
ing and revising maps and figures, collecting illustrations, and assisting 
with updating the Country Profile and revising the Bibliography. Janie 
L. Gilchrist performed word processing and formatting of text. 

The authors also are grateful to other individuals in the Library of 
Congress who contributed to the book. Kathryn Wellen, former Indone- 
sia Reference Specialist in the Asian Division, provided advice and clar- 
ifications on many points. William Tuchrello, director of the Library's 
Overseas Office, Jakarta, and his staff assisted in providing photographs 
and published information from Indonesia. 

Jennifer Foley compiled draft editions of the maps and identified 
many of the photographs used in the book. Graphics support was pro- 
vided by Christopher Robinson, who prepared the book's graphics and 
also performed the photocomposition and preparation of the final digi- 
tal manuscript for the printer. Both he and Katarina David of the Fed- 
eral Research Division performed digital conversion of photographs 
and illustrations used in the study. 

Thanks go to Harris Iskandar, education and cultural attache of the 
Embassy of Indonesia in Washington, DC, for providing useful research 
information on his country. Finally, the authors acknowledge the gener- 
osity of individuals and public and private organizations who allowed 
their photographs to be used in this study; they have been acknowledged 
in the illustration captions. 



Contents 



Foreword iii 

Acknowledgments v 

Preface xiii 

Table A. Selected Acronyms and Contractions xv 

Table B. Chronology of Important Events xxiii 

Table C. Metric Conversion Coefficients and Factors xxix 

Country Profile xxxi 

Introduction xxxix 

Chapter 1. Historical Setting 1 

William H. Frederick 

ORIGINS 4 

Early Inhabitation 4 

Social and Cultural Developments 5 

Expanding Networks 6 

EARLY HEGEMONIES 7 

The Earliest Historical Records 7 

Srivijaya and Mataram 8 

THE RISE AND FALL OF MAJAPAHIT 12 

Successor Kingdoms of Java 12 

Founding and Growth of Majapahit, 1268-1389 14 

Outside Influences 16 

THE EARLY MODERN ERA 18 

Commercial Developments 18 

Westerners and Indigenous Powers 19 

The Role of the Dutch United East Indies Company, 

1602-19 23 

The Javanese and the VOC, 1 6 1 9-1 749 24 

Decline of the VOC, 1749-1816 27 

DEVELOPMENT OF EUROPEAN COLONIAL RULE . . 30 

End of the Ancien Regime in Java, 1 8 1 6-34 30 

Establishment of the Colonial State 33 

vii 



The Cultivation System 34 

The Ethical Policy 38 

The Racial Issue 39 

MODERNISM AND NATIONALISM IN THE 

COLONIAL AGE 41 

The Rise of Education and Student Associations, 

1900-1920 41 

Formation of Political Parties, 191 1-27 44 

The Rise of Sukarno, 1 92 1-26 46 

Colonial Government Reactions, 1927^40 47 

WAR AND EARLY INDEPENDENCE 49 

The Japanese Occupation, 1 9A2-A5 49 

The National Revolution, 1945-49 54 

The Road to Guided Democracy, 1950-65 60 

The "Coup" and Its Aftermath, 1965-66 69 

CONTEMPORARY INDONESIA 72 

Rise of the New Order, 1966-85 72 

Decline and Fall of the New Order, 1985-98 83 

Reformasi and the Post-New Order Era, 1998-2009. . . 85 

Chapter 2. The Society and Its Environment 95 

Joel C. Kuipers 

THE GEOGRAPHIC CONTEXT 98 

Geographic Regions 98 

Volcanoes and Earthquakes 99 

Climate 102 

Environmental Concerns 104 

National Territory: Rights, Responsibilities, and 

Challenges 105 

EMERGING DYNAMICS OF INDONESIAN 

COMMUNITIES 107 

Population 107 

Family 109 

National, Religious, and Local Authority 110 

Urbanization and Decentralization Ill 

Migration 112 

Social Class 114 

Civil Society 115 

Violence, Vengeance, and Law 117 

RELIGION AND WORLD VIE W 118 



viii 



Islam 118 

Christianity 121 

Hinduism 123 

Buddhism 125 

Confucianism and Daoism 126 

THE EMERGING NATIONAL CULTURE 126 

Living Environments 126 

Language 128 

Food, Clothing, and Popular Culture 129 

SOURCES OF LOCAL IDENTIFICATION 130 

Tradition and Multiethnicity 130 

Javanese 132 

Balinese 137 

Peoples of Sumatra 139 

Ethnic Minorities 142 

EDUCATION 150 

Primary and Secondary Education 150 

Islamic Schools 153 

Higher Education 154 

HEALTH 156 

Services and Infrastructure 156 

Government Support 158 

Traditional and Modern Health Practices 159 

Major Health Problems 159 

Pharmaceuticals 160 

Public Sanitation 161 

SOCIETY'S PROSPECTS 161 

Chapter 3. The Economy 163 

J. Thomas Lindblad 

THE ROLE OF GOVERNMENT 166 

The Political Economy of Reform 167 

Financial Reform 169 

Industrial and Trade Reform 1 72 

Crisis Management 1 74 

Postcrisis Reform 177 

GOVERNMENT FINANCE 180 

Central Government Budget 180 

Decentralization 183 

Monetary and Exchange-Rate Policy 185 

ix 



INDONESIA IN THE GLOBAL ECONOMY 188 

The Changing Nature of Trade and Aid 188 

Principal Trade Relationships 191 

EMPLOYMENT AND INCOME 192 

AGRICULTURE 197 

Food Crops 198 

Export Crops 199 

Livestock 202 

Fishing and Forestry . . . * 202 

INDUSTRY 205 

Foreign Inputs 206 

Small-Scale Industry 209 

MINERALS 210 

Petroleum and Natural Gas 210 

Other Minerals 212 

SERVICES AND INFRASTRUCTURE 214 

Transportation 215 

Post and Telecommunications 219 

Electric Power 220 

ECONOMIC PROSPECTS 221 

Chapter 4. Government and Politics 225 

Blair A. King 

THE POLITICAL DEBATE 229 

THE CONSTITUTIONAL FRAMEWORK 231 

THE STRUCTURE OF GOVERNMENT 234 

Legislative Bodies 235 

The Executive 241 

The Judiciary 244 

Independent Bodies 246 

Local Government 247 

POLITICAL CULTURE 253 

Inclusionary Coalitions 254 

Consensus-Based Decision Making 256 

Traditional Political Culture 257 

Islamic Political Culture 258 

Pancasila: The State Ideology 260 

THE POLITICAL PROCESS 262 

The Multiparty System: Significant Pluralism 263 

Secular Nationalist Parties 264 



x 



Muslim Parties 268 

Islamist Parties 271 

Elections 275 

Political Dynamics 279 

THE MEDIA 286 

FOREIGN POLICY 288 

Political Considerations 288 

Participation in ASEAN 290 

Relations with Neighboring Nations 295 

Relations with East Asia 301 

Relations with the United States 303 

CONSOLIDATING DEMOCRACY, CONTRIBUTING TO 

GLOBAL PEACE 305 

Chapter 5. National Security 307 

John B. Haseman 

HISTORICAL CONTEXT 312 

Independence and the Sukarno Period, 1945-65 312 

Suharto's New Order, 1 966-98 315 

POST-SUHARTO REFORMS 319 

East Timor 321 

Separatist Rebellions 323 

Ethnic and Religious Conflict 328 

Terrorism 329 

THE ARMED FORCES IN NATIONAL LIFE 330 

Political and Administrative Role 332 

Participation in the Economy 332 

Total People's Defense 334 

Defense Spending and the Defense Industry 335 

Personnel 338 

ORGANIZATION AND EQUIPMENT OF THE 

ARMED FORCES 339 

Administrative and Command Structure 339 

Military Education 343 

Branches of Service 344 

Conditions of Service 349 

Women in the Armed Forces 349 

Uniforms, Ranks, and Insignia 350 

FOREIGN MILITARY RELATIONS 350 

SECURITY AND INTELLIGENCE AGENCIES 354 

xi 



THE NATIONAL POLICE 355 

THE CRIMINAL JUSTICE SYSTEM 358 

Crime and Political Offenses 359 

Criminal Law and Proceedings 359 

Administration of Criminal Justice 360 

Penal System 362 

Narcotics and Counternarcotics Operations 363 

NATIONAL SECURITY IN THE CONTEMPORARY 

ERA \ 363 

Bibliography 367 

Glossary 405 

Index 413 

Contributors 437 

Published Country Studies 439 

List of Figures 

1 Administrative Divisions of Indonesia, 2009 xxxviii 

2 Sumatra and Java from the Seventh Century to the 

Eleventh Century 10 

3 The Eastern Archipelago in the Seventeenth and 

Eighteenth Centuries 20 

4 Dutch Expansion in Java, 1619-1830 28 

5 Sulawesi in the Nineteenth and Twentieth Centuries .... 32 

6 Topography and Drainage 100 

7 Age-Sex Ratio, 2009, and Projected Ratio, 2029 108 

8 Major Crop Production, 2009 200 

9 Selected Industrial Activity, 2009 208 

10 Major Transportation Facilities, 2009 218 

11 Structure of the Government, 2009 236 

12 Organization of the Department of Defense, 2009 320 

13 Organization of the Armed Forces, 2009 340 

14 Army Territorial Structure, 2009 342 

15 Navy Fleet Commands, 2009 348 

16 Air Force Operations Commands, 2009 348 

1 7 Officer Ranks and Insignia, 2009 351 

1 8 Enlisted Ranks and Insignia, 2009 353 



xii 



Preface 



This edition of Indonesia: A Country Study replaces the previous 
edition, published in 1993. Like its predecessor, this study attempts to 
review the history and treat in a concise manner the dominant social, 
political, economic, and military aspects of contemporary Indonesia. 
Sources of information included books, scholarly journals, foreign and 
domestic newspapers, official reports of governments and interna- 
tional organizations, and numerous periodicals and Web sites on Indo- 
nesian and Southeast Asian affairs. 

To avoid confusion over the spelling and pronunciation of Indonesian 
names and terms, the so-called new spelling (ejaan yang disempurna- 
kan — EYD — perfected spelling) of 1972, which replaced an earlier sys- 
tem based in part on pre-World War II Dutch spellings, has been used 
throughout, even when it differs from the personal preference of individu- 
als. The usage and alphabetization of Indonesian names may also pose 
problems for those familiar with Indonesian cultures as well as the prefer- 
ences of individuals and fashions of any given period. The procedure fol- 
lowed in this volume is to alphabetize according to the last name of the 
individual when two or more names exist. Thus, works by the historian 
Sartono Kartodirjo are listed under "Kartodirjo, Sartono." The military fig- 
ure Sarwo Edhie Wibowo is alphabetized under "Wibowo." This proce- 
dure is at odds with some earlier Indonesian practices, but it has the 
advantage of being easily understood internationally and is becoming 
more common in Indonesia itself. Some individuals are generally referred 
to using the first element(s) of their name — such as "Sarwo Edhie" rather 
than Wibowo — and others by the last element, such as Ibnu Sutowo, who 
is referred to as "Sutowo" or "Colonel Sutowo" or "Colonel Ibnu Sutowo" 
but not as "Ibnu." Some individuals, such as former presidents Sukarno 
and Suharto, used only one name, and former president Megawati Sukar- 
noputri is always referred to as Megawati and not Sukarnoputri, which is a 
contrived surname. Thus, the late President Abdurrahman Wahid is 
referred to as President Wahid and President Susilo Bambang Yudhoyono 
as President Yudhoyono. In this regard, this book follows the practices 
observed in contemporary Indonesian discourse and print media, even if 
these themselves are, in a few instances, inconsistent. Some Islamic terms 
familiar to readers in transliteration from Arabic are spelled here in translit- 
eration according to EYD. 

The spelling of contemporary place-names conforms in most cases to 
the system approved by the U.S. Board on Geographic Names (BGN); 



xiii 



spellings of some names, however, cannot be verified, as the BGN itself 
notes. Indonesian spellings are given for all modern province names, 
such as Jawa Tengah (Central Java). Similarly, the names Sumatera 
Utara (North Sumatra) and Papua Barat (West Papua) are used to refer to 
provinces on the islands of Sumatra and Papua, respectively. Conven- 
tional spellings of names referring more generally to portions of Java, for 
example, are given in lower case and the form "eastern Java," "southern 
Sumatra," and so on. 

Because of the widespread use of acronyms and contractions in 
Indonesia, the ones used in this edition are listed in a table along with 
an English translation at the front of the book (see table A). A chronol- 
ogy of major historical events also is provided (see table B). Measure- 
ments are given in the metric system; a conversion table is provided to 
assist readers wanting to convert metric measurements (see table C). 

Readers are encouraged to consult the chapter bibliographies at the 
end of the book, which include a number of general and specialized, 
primarily English-language-source bibliographies that will lead read- 
ers to further resources on Indonesia. Also, brief comments on some 
of the more valuable and enduring sources recommended for further 
reading appear at the end of each chapter. A glossary also is included. 

The body of the text reflects information available as of July 2010. 
Certain other parts of the text, however, have been updated: the Chro- 
nology and Introduction discuss significant events that have occurred 
since the completion of research, and the Country Profile and portions 
of some chapters include updated information as available. Indonesia 
completed its decennial census in May 2010, but the full results were 
not available for inclusion in the main text of this book. 



xiv 



Table A. Selected Acronyms and Contractions 



Acronym or 
Contraction 



Full Name 



ABRI Angkatan Bersenjata Republik Indonesia (Armed Forces of the Republic of Indonesia); 

used from 1962 to 1999 and included the National Police; thereafter TNI (q. v.) has been 
used. 

AEC ASEAN (q. v.) Economic Community 

AFTA ASEAN (q. v. ) Free Trade Area 

AIDS acquired immune deficiency syndrome 

AJI Aliansi Jurnalis Independen (Alliance of Independent Journalists) 

Akmil Akademi Militer (Military Academy) 

Apodeti Associagao Popular Democratica Timorense (Timorese Popular Democratic Associa- 

tion) 

APRI Angkatan Perang Republik Indonesia (Armed Forces of the Republic of Indonesia); 

successor to APRIS (q. v.) in August 1950, used until 1962; APRI was identical to TNI 
(q.v), which was the more commonly used term. 

APRIS Angkatan Perang Republik Indonesia Serikat (Armed Forces of the Federal Republic of 

Indonesia [RIS, q.v.]); used in 1949 and early 1950, when APRIS merged with KNIL 
(q.v.). 

ARF ASEAN (q. v. ) Regional Forum 

ASA Aksi Stop AIDS (Stop AIDS [q.v] Action) 

ASEAN Association of Southeast Asian Nations (see Glossary) 

ASNLF Aceh Sumatra National Liberation Front 

Babinsa Bintara Desa (village NCO, q.v.) 

Bais Badan Intelijens Stratejis (Armed Forces Strategic Intelligence Body) 

Bakin Badan Koordinasi Intelijen Nasional (National Intelligence Coordinating Board) 

BAN-PT Badan Akreditasi Nasional Perguruan Tinggi (National Accreditation Agency for 

Higher Education) 

Bappenas Badan Perencanaan Pembangunan Nasional (National Development Planning Board) 

Bareskrim Badan Reserse Kriminal (Crime Investigation Agency); also see Kabareskrim 

Bimas Bimbingan Massal (Mass Guidance System) 

BIN Badan Intelijen Nasional (National Intelligence Agency) 

BKKBN Badan Koordinasi Keluarga Berencana Nasional (National Family Planning Coordinat- 

ing Agency) 

BKPM Badan Koordinasi Penanaman Modal (Capital Investment Coordinating Board) 

BKR Badam Keamanan Rakyat (People's Security Forces); used August 22-October 5, 

1945, when it was succeeded by the TKR (q.v). 

BPK Badan Pemeriksa Keuangan (Finance Audit Board) 

BPPN Badan Penyehatan Perbanken Nasional (Indonesian Bank Restructuring Agency; also 

abbreviated as IBRA, q.v.) 

BPPT Badan Pusat Pengembangan Teknologi (Agency for the Study and Application of Tech- 

nology) 

BPS Badan Pusat Statistik (Central Statistical Office; also referred to as Central Bureau of 

Statistics and Statistics Indonesia) 

BPTRI Balai Perguruan Tinggi Republik Indonesia (Republic of Indonesia Institute for Higher 

Education) 

BPUPK Badan Penyelidik Usaha-Usaha Persiapan Kemerdekaan (Commission to Investigate 

Preparatory Measures for Independence) 



XV 



Table A. Selected Acronyms and Contractions (Continued) 

^ Cr0ny ™° r Full Name 
Contraction 

BRI Bank Rakyat Indonesia (Indonesian People's Bank) 

BRR Badan Rehabilitasi dan Rekonstruksi (Rehabilitation and Reconstruction Agency) 

Bulog Badan Urusan Logistik (National Logistical Supply Organization) 

Caltex California Texas Oil Company 

CEMEX formerly Cementos Mexicanos 

CGI Consultative Group on Indonesia 

CIA Central Intelligence Agency (U.S.) 

CMI Crisis Management Initiative 

COHA Cessation of Hostilities Agreement 

DDR Deutsche Demokratische Republik (Democratic Republic of Germany — or East 
Germany) 

Depdiknas Departmen Pendidikan Nasional (Department of National Education) 

Dephan Departmen Pertahanan (Department of Defense; since 1999) 

DPD Dewan Perwakilan Daerah (Regional Representative Council) 

DPR Dewan Perwakilan Rakyat (People's Representative Council) 

DPRD Dewan Perwakilan Rakyat Daerah (Regional People's Representative Council) 

EU European Union 

EYD ejaan yang disempurnakan (perfected, or new, spelling of Bahasa Indonesia language, 
adopted in 1972) 

FDI foreign direct investment 

FMF Foreign Military Financing (U.S.) 

FMS Foreign Military Sales (U.S.) 

FNC Fabrique Nationale Carabine (National Factory Carbine, a carbine made by Fabrique 

Nationale de Herstel, Belgium) 

FPI Front Pembela Islam (Islamic Defenders' Front) 

FSPSI Federation Serikat Pekerja Seluruh Indonesia (All-Indonesian Workers' Union Federa- 

tion) 

Fretilin Frente Revolucionaria do Timor Leste Independente (Revolutionary Front for an Inde- 

pendent East Timor — see Glossary) 

FY fiscal year (see Glossary) 

GAM Gerakan Aceh Merdeka (Free Aceh Movement) 

GDP gross domestic product (see Glossary) 

Gerindra Gerakan Indonesia Raya (Great Indonesia Movement, as in Partai Gerindra or Gerindra 
Party) 

Gestapu Gerakan September Tiga Puluh (September 30 Movement, also G30S) 

GMT Greenwich Mean Time 

Golkar Golongan Karya (Functional Groups — see Glossary) 

GPK Gerakan Pengacauan Keamanan (Security Disturbance Movement) 

Hankam Departmen Pertahanan dan Keamanan (Department of Defense and Security; prior to 

1999) 

Hankamrata Pertahanan dan Keamanan Rakyat Total (Total People's Defense) 

Hanura Hati Nurani Rakyat (People's Conscience Party, as in Partai Hanura or Hanura Party) 

HIS Hollands-Inlandsche School (Dutch-Native Schools) 



xvi 



Table A. Selected Acronyms and Contractions (Continued) 

Acronym or „ „ x T 

_ . J .. Full Name 
Contraction 

HIV human immunodeficiency virus 

HMI Himpunan Mahasiswa Islam (Islamic University Student Association) 

IAIN Institut Agama Islam Negara (State Institute for Islamic Religion) 

IBRA Indonesian Bank Restructuring Agency (also BPPN, q.v.) 

ICMI Ikatan Cendekiawan Muslim Indonesia (Indonesian Muslim Intellectuals' Association) 

IGGI Inter-Governmental Group on Indonesia 

ILO International Labour Organisation 

IMET International Military Education and Training (U.S.) 

IMF International Monetary Fund 

Indra Indonesian Debt Restructuring Agency (Badan Restrukturalisasi Utang Luar Negeri 
Perusahaan Indonesia, which in full translates as Agency for Structuring the Foreign 
Debt of Indonesian Industries) 

INTERFET International Force in East Timor 

Interpol International Criminal Police Organization 

IPKI Ikatan Pendukung Kemerdekaan Indonesia (League of the Supporters of Indonesian 
Independence) 

IPTN Industri Pesawat Terbang Nusantara (Archipelago Aircraft Industry) 

ISDV Indische Sociaal-Democratische Vereeniging (Indies Social-Democratic Association) 

IVS Indonesische Verbond van Studerenden (Indonesian Student Association ) 

Jabodetabek Jakarta, Bogor, Depok, Tangerang, and Bekasi 

Jabotabek Jakarta, Bogor, Tangerang, and Bekasi 

JIL Jaringan Islam Liberal (Network for Liberal Islam) 

Kabareskrim Kepala Badan Reserse Kriminal (head of Crime Investigation Agency); also see 
Bareskrim 

Kasum Kepala Staff Umum (Chief of the General Staff) 

KNIL Koninklijk Nederlandsch Indisch Leger (Royal Netherlands Indies Army) 

KNIP Komite Nasional Indonesia Pusat (Central National Committee) 

Kodam Komando Daerah Militer (Military Regional Command) 

Kodim Komando Distrik Militer (Military District Command) 

Kohanudnas Komando Pertahanan Udara Nasional (National Air Defense Command) 

Komnas Komite Nasional Pengendalian Flu Burung Kesiapsiagaan Menghadapi Pandemi Influ- 

FBPI enza (National Committee for Avian Influenza Control and Pandemic Influenza Pre- 
paredness) 

Ko-Op Komando Operasi (Operations Command) 

Kopassandha Komando Pasukan Sandi Yudha (Army Special Forces Command); also see Kopassus 

Kopassus Komando Pasukan Khusus (Army Special Forces Command) 

Kopkamtib Komando Operasi Pemulihan Keamanan dan Ketertiban (Operational Command for 
the Restoration of Security and Order) 

Koramil Komando Rayon Militer (Military Subdistrict Command) 

Korem Komando Resor Militer (Military Resort, or Garrison, Command) 

Kostrad Komando Strategis Cadangan Angkatan Darat (Army Strategic Reserve Command) 

KPK Komisi Pemberantasan Korupsi (Corruption Eradication Commission) 



Table A. Selected Acronyms and Contractions (Continued) 

Acronym or Full Name 
Contraction 

KPPU Komisi Pengawas Persaingan Usaha (Commission for the Oversight of Business Com- 
petition) 

KPU Komisi Pemilihan Umum (General Elections Commission) 

LatGap Latihan Gabungan (Joint Exercise) 

Lemhanas Lembaga Ketahanan Nasional (National Resiliency Institute) 

LNG liquefied natural gas 

LSM lembaga swadaya masyarakat (nongovernmental organizations), also sometimes ornop 

(q.v.) 

Lusi Lumpur Sidoarjo (Sidoarjo mud volcano) 

Manipol Manifes Politik (Political Manifesto) 

Masyumi Majelis Syuro Muslimin Indonesia (Consultative Council of Indonesian Muslims) 

MDMA methylenedioxymethamphetamine (Ecstasy) 

MPR Majelis Permusyawaratan Rakyat (People's Consultative Assembly) 

MPR(S) Majelis Permusyawaratan Rakyat (Sementara) (Provisional People's Consultative 

Assembly) 

MRP Majelis Rakyat Papua (Papuan People's Council) 

NAD Nanggroe Aceh Darussalam (State of Aceh, Abode of Peace, a name used from 2000 to 

2009) 

Nasakom Nasionalisme, Agama, Komunisme (Nationalism, Religion, Communism) 

NCO noncommissioned officer 

NGO nongovernmental organization; also see LSM and ornop 

NHM Nederlandsche Handel-Maatschappij (Netherlands Trading Association) 

NICA Netherlands Indies Civil Administration 

Nil Negara Islam Indonesia (Islamic State of Indonesia) 

NMDP national medium-term development plan 

OECD Organisation for Economic Co-operation and Development 

OIC Organization of the Islamic Conference 

OPEC Organization of the Petroleum Exporting Countries (see Glossary) 

OPM Organisasi Papua Merdeka (Free Papua Organization) 

ornop organisasi nonpemerintah (nongovernmental organizations); also sometimes LSM 

{q.v.) 

OS VIA Opleidingschool voor Inlandsche Ambtenaren (School for Training Native Govern- 

ment Officials) 

P4 Pedoman Penghayatan dan Pengamalan Pancasila (Guide to Realizing and Experienc- 

ing the Pancasila) 

PAN Partai Amanat Nasional (National Mandate Party) 

panja panitia kerja (working committee) 

pansus panitia khusus (special committee) 

Panwaslu Panitia Pengawas Pemilu (Election Oversight Committee) 

Parkindo Partai Kristen Indonesia (Indonesian Christian Party) 

Partindo Partai Indonesia (Indonesian Party) 

PasMar Pasukan Marinir (Marine Corps Group) 



Table A. Selected Acronyms and Contractions (Continued) 

Acronym or _ „ XT 

„ ^ J . Full Name 
Contraction 

PBB Partai Bulan Bintang (Star and Moon Party); also used for Perserikata Bangsa-Bangsa 
(United Nations) 

PBR Partai Bintang Reformasi (Reform Star Party) 

PD Partai Demokrat (Democrat Party) 

PDI Partai Demokrasi Indonesia (Indonesian Democracy Party) 

PDI-P Partai Demokrasi Indonesia-Perjuangan (Indonesian Democracy Party-Struggle) 

PDP Partai Demokrasi Pembaruan (Democracy Renewal Party) 

PDS Partai Damai Sejahtera (Prosperous Peace Party) 

Pelni Perusahaan Layaran Nasional Indonesia (Indonesian National Shipping Company) 

Permesta Perjuangan Semesta Alam (Universal Struggle); also Piagam Perjuangan Semesta 
Alam (Universal Struggle Charter) 

Pertamina Perusahaan Pertambangan Minyak dan Gas Bumi Negara (State Oil and Natural Gas 
Mining Company, but translated as State Oil Company by Pertamina itself) 

Perti Persatuan Tarbiyah Islamiyah (Islamic Educational Movement) 

Peta Pembela Tanah Air (Defenders of the Fatherland) 

Petrus penembakan misterius (mysterious shootings) or pembunuhan misterius (mysterious 
killings) — Both terms have been used in the Indonesian press. 

PID Politiek Inlichtingen Dienst (Political Intelligence Service) 

PIR Perkebunan Inti Rakyat (Nucleus People's Estate) 

PK Partai Keadilan (Justice Party) 

PKB Partai Kebangkitan Bangsa (National Awakening Party) 

PKH Perserikatan Komunis di Hindia (Communist Association of the Indies) 

PKI Partai Komunis Indonesia (Indonesian Communist Party; see Glossary) 

PKPI Partai Keadilan dan Persatuan Indonesia (Indonesian Justice and Unity Party) 

PKS Partai Keadilan Sejahtera (Prosperous Justice Party) 

PLN Perusahaan Listrik Nasional (National Electric Company) 

PMI Partai Muslimin Indonesia (Muslim Party of Indonesia) 

PNI Partai Nasional Indonesia (Indonesian Nationalist Party) 

PNI-M Partai Nasional Indonesia-Marhaenisme (Indonesian Nationalist Party-Marhaenism) 

Polda Polisi Daerah (Regional Police) 

Polri Kepolisian Republik Indonesia (National Police of Indonesia) 

PP Partai Pelopor (Pioneer Party) 

PPKI Panitia Persiapan Kemerdekaan Indonesia (Indonesian Independence Preparatory 
Committee) 

PPP Partai Persatuan Pembangunan (Development Unity Party) 

PRD Partai Rakyat Demokratik (Democratic People's Party) 

PRRI Pemerintah Revolusioner Republik Indonesia (Revolutionary Government of the 
Republic of Indonesia) 

PSII Partai Sarekat Islam Indonesia (Islamic Association Party of Indonesia) 

pungli pungutan liar (illegal levies, that is, kickbacks) 

Putera Pusat Tenaga Rakyat (Center of the People's Power) 

RCTI Rajawali Citra Televisi Indonesia (Hawk Television Indonesia) 



Table A. Selected Acronyms and Contractions (Continued) 

^onymor Full Name ~~ 
Contraction 

Repelita Rencana Pembangunan Lima Tahun (five-year economic development plan; see Glos- 
sary) 

RIS Republik Indonesia Serikat (Federal Republic of Indonesia) 

RMS Republik Maluku Selatan (Republic of South Maluku) 

ROTC Reserve Officers' Training Corps (U.S.) 

Rp rupiah (see Glossary) 

Satelindo Satelit Palapa Indonesia 

SBI Sertifikat Bank Indonesia (Bank Indonesia Certificate) 

SBSI Serikat Buruh Sejahtera Indonesia (Indonesian Prosperous Workers' Union) 

SBY Susilo Bambang Yudhoyono 

SCTV Surya Citra Televisi (Sun Television) 

Sesko TNI Sekolah Staf dan Komando TNI (TNI [q. v.] Command and Staff College) 

SIJORI Singapore, Johor, and Riau 

SIRA Sentral Informasi Referendum Aceh (Aceh Referendum Information Center) 

SPSI Serikat Pekerja Seluruh Indonesia (All-Indonesian Workers' Union) 

Stanvac Standard- Vacuum Oil Company 

STOVIA School tot Opleiding van Inlandsche Artsen (School for Training Indigenous Doctors) 

Supersemar Surat Perintah Sebelas Maret (Letter of Instruction of March 1 1 ) 

TAC Treaty of Amity and Cooperation in Southeast Asia 

Til Tentara Islam Indonesia (Islamic Army of Indonesia) 

Timtas Tim Pemberantasan Tindak Pidana Korupsi (Coordinating Team for Eliminating 

Tipikor Crimes of Corruption) 

Tipikor Court Pengadilan Tindak Pidana Korupsi (Corruption Crimes Court) 

TKR Tentara Keamanan Rakyat (People's Security Army); used as of October 5, 1945, as 
successor to BKR (q.v.); also Tentara Keselamatan Rakyat (People's Security Army) as 
of January 1, 1946. 

TNI Tentara Nasional Indonesia (Indonesian National Army); from 1947 to 1962 and again 
starting in April 1999 but now usually translated as Indonesian National Armed Forces; 
also see ABRI, APRI, and APRIS. 

TNI-AD Tentara Nasional Indonesia- Angkatan Darat (Army of the Republic of Indonesia) 

TNI-AL Tentara Nasional Indonesia-Angkatan Laut (Navy of the Republic of Indonesia) 

TNI-AU Tentara Nasional Indonesia-Angkatan Udara (Air Force of the Republic of Indonesia) 

TPI Televisi Pendidikan Indonesia (Indonesian Educational Television) 

TPN Timor Putra Nasional (National Son Timor) 

TRI Tentara Republik Indonesia (National Army of the Republic of Indonesia); used as of 
January 24, 1946, as successor to TKR (q.v.). 

TVRI Televisi Republik Indonesia (Television of the Republic of Indonesia) 

UIN Universitas Islam Negara (State Muslim University) 

UN United Nations 

UNDP United Nations Development Programme 

UNESCO United Nations Educational, Scientific, and Cultural Organization 

UNICEF United Nations Children's Fund 

UNTAC United Nations Transitional Authority in Cambodia 



XX 



Table A. Selected Acronyms and Contractions (Continued) 



Acronym or 
Contraction 



Full Name 



UNTAET United Nations Transitional Administration in East Timor 

USDEK Undang-undang Dasar '45, Socialisme a la Indonesia, Demokrasi Perpimpin, Ekonomi 

Terpimpin, Kepribadian Indonesia (1945 Constitution, Indonesian Socialism, Guided 
Democracy, Guided Economy, and Indonesian Identity, usually paired with Manipol 
[q. v.] to read Manipol-USDEK) 

USINDO United States-Indonesia Society 

UVI Universiteit van Indonesie (University of Indonesia; later changed to Universitas Indo- 

nesia [University of Indonesia]) 

VAT value-added tax 

VCI Vehicule de Combat d'Infanterie (Combat Infantry Vehicle [France]) 

VOC Verenigde Oostindische Compagnie (United East Indies Company) 

YKP Yayasan Kesehatan Perempuan (Foundation for Women's Health) 

ZOPFAN Zone of Peace, Freedom, and Neutrality 



xxi 



Table B. Chronology of Important Events 



By ca. 1.8 million B.C. Homo erectus, an early hominid, living in Java. 

By ca. 600,000 B.C. Fairly sophisticated hominid cultures scattered throughout the archipel- 

ago. 

Ca. 40,000 B.C. Earliest verifiable modern human (Homo sapiens) remains (Sulawesi 

and Java). 

Ca. 3,000 B.C. Austronesians begin voyaging from the Philippines into Indonesian 

archipelago. 

Beginning ca. 400 B.C. Development of regional trade linking present-day China, Vietnam, 

India, the Mediterranean, and other points to the archipelago. 

Ca. A.D. 375 Kutai (eastern Kalimantan) and Taruma (Java) rise as Indian-influenced 

kingdoms. 

Mid-sixth century Kingdom of Srivijaya rises in southern Sumatra, in later centuries 

spreads to western Java and the Malay Peninsula. 

Ca. 732 Rise of Mataram (central Java) under Sanjaya. 

Ca. 770-820 Construction of the Buddhist temple Borobudur (central Java). 

Ca. 820-50 Construction of the Hindu temple complex at Prambanan (central Java). 

929-1292 Rise of Mataram in eastern Java, followed by Kediri and Singhasari; 

conflict with Bali and Srivijaya. 

1211 Death of Sultan Sulaiman of Lamreh, northern Sumatra, first verifiable 

Muslim ruler in the archipelago. 

1294 Rise of Majapahit (eastern Java) in wake of Mongol incursion. 

Mid- 14th century Golden age of expanded Hindu-Buddhist Majapahit kingdom under 

Hayam Wuruk (Rajasanagara, r. 1350-89) and Prime Minister Gajah 
Mada (in office 1331-64). 

1364 Gajah Mada dies; architect of an expanded Majapahit empire throughout 

much of archipelago. 

1405-33 Seven Chinese maritime expeditions led by Zheng He, some of which 

land in Java, Sumatra, and points as distant as East Africa. 

1511 Portuguese occupy Melaka, on Malay Peninsula, and arrive a year later 

in Ternate, Maluku, where they build a fort in 1522. 

1527 Final days of Majapahit as the small Muslim port state of Demak defeats 

Majapahit capital at Kediri, eastern Java. 

1595-1601 First Dutch ships in archipelago. 

1602 United East Indies Company (VOC — see table A) established by Dutch. 

1607-36 Rule of Iskandar Muda, sultanate of Aceh, northern Sumatra. 

1610-80 VOC gradually extends dominance over eastern archipelago, for exam- 

ple in Ternate, Hitu, and southern Sulawesi. 

1613^16 Sultan Agung rules in an expanding Mataram, central Java. 

1 6 1 9-2 1 VOC establishes control over Jayakerta (present-day Jakarta). 

1704-55 Javanese wars of succession, in which the VOC becomes embroiled. 

1723 Coffee becomes a VOC monopoly in a forced-delivery system in Prian- 

gan, western Java. 

1 755 Treaty of Giyanti (Java). 

1 799-1 800 VOC charter lapses following bankruptcy; holdings taken over by Neth- 

erlands state. 

1 808-16 Rule of Java and other Dutch territories in the archipelago by French 

(under Herman Willem Daendals, 1 808-1 1 ) and British (under Thomas 
Stamford Raffles, 1811-16). 

1816 Dutch control of Java and other territories reestablished. 

1821-37 Padri Wars in Minangkabau region of western Sumatra. 



Table B. Chronology of Important Events (Continued) 



1824 

1825-30 

1830 
1870 
1873 

1873-1903 
1890 

1901 
1902 

1907 

1908 

1909 

1911 
1912 
1914 

1926 

July 1927 
February 1933 
July 1936 

March 1942 

October 1943 

September 1944 
June 1, 1945 
August 15, 1945 
August 17, 1945 

August 18, 1945 
September 29, 1945 
November 10, 1945 
November 12, 1946 

July 21, 1947 
January 19, 1948 



Anglo-Dutch treaty recognizes spheres of influence in Malay Peninsula 
and Sumatra, respectively. 

Java War; last Javanese aristocratic resistance to Dutch rule; Prince 
Diponegoro central figure. 

Introduction of the Cultivation System by Johannes van den Bosch. 
Sugar Act and Agrarian Act enacted, end of the Cultivation System. 
First state-sponsored railroad in archipelago, central Java. 
Aceh War. 

Royal Dutch Company for Exploration of Petroleum Sources in the 
Netherlands Indies established. 

Ethical Policy inaugurated. 

Inauguration of Transmigration Program, in which Javanese move to 
Outer Islands (see Glossary). 

Royal Dutch Shell established through merger of Dutch and British 
companies. 

First modern political organization — Budi Utomo (Noble Endeavor) — 
established. 

Sarekat Dagang Islam (Islamic Trade Association) founded in Surakarta, 
central Java; becomes Sarekat Islam (Islamic Association) in 1912. 

Indies Party (Indische Partij) founded. 

Muhammadiyah (Followers of Muhammad) established in Yogyakarta. 

Indies Social-Democratic Association (ISDV) founded, forerunner of 
the Communist Association of the Indies (PKH, 1 920) and Indonesian 
Communist Party (PKI, 1924). 

Nahdlatul Ulama (literally, revival of the religious teachers, sometimes 
referred to as Council of Scholars) founded in eastern Java. 

Sukarno and others establish the Indonesian Nationalist Union (PNI) in 
western Java; becomes Indonesian Nationalist Party (PNI) in 1928. 

Mutiny on Dutch warship De Zeven Provincien begins a period of 
greater political pressure. 

Sutarjo Petition, calling for a conference on the possibility of Indies 
autonomy within the constitution of the Netherlands, accepted by Volks- 
raad, later rejected by Dutch government. 

Dutch surrender control of Indies to Japanese military forces, Kalijati, 
western Java. 

Beginning of Peta (Java) and Giyugun (Sumatra), Japanese-designed 
defense force. 

Japan promises independence. 

Sukarno announces the Pancasila (see Glossary). 

Japan surrenders. 

Sukarno and Mohammad Hatta proclaim independent Republic of Indo- 
nesia. 

Constitution promulgated. 

First Allied troops (British and British Indian) land at Jakarta. 
Battle of Surabaya, eastern Java. 

Linggajati Agreement initialed; recognizes Republican rule on Java and 
Sumatra and the Netherlands-Indonesian Union under the Dutch crown; 
Indonesia ratifies May 25, 1947. 

First Dutch "police action" begins (ends August 4, 1947). 
Renville Agreement signed. 



xxiv 



Table B. Chronology of Important Events (Continued) 



September 18, 1948 

December 19, 1948 
January 1949 

August 23-November 2, 
1949 

December 27, 1949 
January- April 1950 
August 17, 1950 

April 18-24, 1955 
September 29, 1955 
May 8, 1956 
December 1, 1956 

February 21, 1957 
March 14, 1957 
December 1957 

February-May 1958 

July 5, 1959 
August 17, 1959 

March 1960 

May 1963 

September 23, 1963 

October 1964 

January 1, 1965 

September 30- October 1, 
1965 

October 1965-March 1966 



March 11, 1966 

March 12, 1966 
August 11, 1966 
September 23, 1966 
March 12, 1967 

August 8, 1967 
October 1967 
March 27, 1968 



Madiun Affair erupts in eastern Java, pitching the PKI against the 
Republic. 

Second Dutch "police action" begins (ends January 5, 1949). 

United Nations (UN) Security Council demands reinstatement of 
Republican rule. 

Round Table Conference held at The Hague prepares for formal transfer 
of sovereignty. 

Dutch recognize sovereignty of Federal Republic of Indonesia (RIS). 

Separatist revolts begin in western Java and Maluku Islands. 

RIS and other states form new unitary Republic of Indonesia under 
amendment to RIS constitution; Sukarno confirmed as president. 

Asia-Africa Conference held in Bandung, Jawa Barat Province. 

First national elections. 

Indonesia leaves Netherlands-Indonesian Union. 

Hatta resigns as vice president in protest against Sukarno's growing 
authoritarianism; office remains vacant until 1973. 

Sukarno proposes Guided Democracy concept. 

Sukarno declares martial law. 

Dutch nationals expelled; private companies nationalized; armed forces 
take greater role in economic affairs. 

Anti-Sukarno revolts in Sumatra and Sulawesi; Sukarno accuses United 
States of complicity. 

1 945 constitution restored. 

Political Manifesto (Manipol) announced, gives ideological content to 
Guided Democracy 

New legislature organized with control given to functional groups, 
including the military; PKI emerges stronger. 

Indonesian authority established in West New Guinea (renamed Irian 
Barat). 

Sukarno issues statements threatening independence of new state of 
Malaysia; three-year Confrontation (see Glossary) begins. 

Golongan Karya (Golkar — see Glossary) formed by army leaders. 

Sukarno withdraws Indonesia from the UN. 

Abortive, communist-inspired coup launched. 

Decline of Sukarno, rise of Suharto; Guided Democracy eclipsed; mass 
killings of PKI members and suspected affiliates; tens of thousands 
jailed. 

Sukarno transfers authority to Suharto (Supersemar — see Glossary); 
marks rise of New Order. 

PKI formally banned. 

Confrontation with Malaysia ends. 

Indonesia rejoins UN. 

Suharto appointed acting president by Provisional People's Consultative 
Assembly (MPR(S)); New Order era officially acknowledged; relations 
with China "frozen." 

Indonesia joins four other countries in founding new Association of 
Southeast Asian Nations (ASEAN — see Glossary). 

Demonstrators attack Chinese Embassy in Jakarta, diplomatic relations 
severed. 

Suharto elected president by MPR(S). 



XXV 



Table B. Chronology of Important Events (Continued) 



September 1969 



July 3, 1971 
January 1973 

March 12, 1973 

January 15, 1974 
December 7, 1975 
July 15, 1976 
May 2, 1977 
March 22, 1978 

May 5, 1980 

May 4, 1982 
March 11, 1983 

April 1983 

April 23, 1987 
March 10, 1988 

July 1990-October 1991 

August 8, 1990 
November 12, 1991 

March 1992 



June 9, 1992 
September 1992 

March 10, 1993 

June 21, 1994 
December 18, 1995 
July 27, 1996 

May 29, 1997 
October 27, 1997 

March 3, 1998 
March 21, 1998 



Irian Barat (Indonesian New Guinea) becomes Indonesia's twenty-sixth 
province following Act of Free Choice among tribal leaders; name 
changed to Irian Jaya in 1972; in 2001 renamed Papua, and in 2003 
divided into three separate provinces (only two of which had been estab- 
lished as of 20 10). 

Golkar wins majority of popular vote in second general elections. 

Development Unity Party (PPP) and Indonesian Democracy Party (PDI) 
formed. 

Suharto reelected to second term as president, and Hamengkubuwono 
DC elected vice president by People's Consultative Assembly (MPR). 

Malari Affair, Jakarta. 

Indonesian armed forces invade East Timor. 

East Timor becomes Timor Timur, Indonesia's twenty-seventh province. 

Third general elections; Golkar majority confirmed. 

Suharto reelected to third term as president, Adam Malik elected vice 
president by MPR. 

Petition of 50 accuses Suharto of one-man, antidemocratic rule; group is 
suppressed. 

Fourth general elections; Golkar majority maintained. 

Suharto reelected to fourth term as president, Umar Wirahadikusumah 
elected vice president, by MPR. 

Beginning of anonymous "mysterious killings" (petrus) of criminals and 
others in many large cities, especially on Java. 

Fifth general elections; Golkar majority increases. 

Suharto reelected to fifth term as president, Sudharmono elected as vice 
president, by MPR. 

Paris International Conference on Cambodia, co-chaired by Indonesia 
and France, features Jakarta's role as peacemaker in Cambodia. 

Indonesia and China reestablish diplomatic relations. 

Armed Forces of the Republic of Indonesia (ABRI) troops fire on 
funeral at Santa Cruz Cemetery, Dili, East Timur, killing 50-250. 

Dutch-chaired Inter-Governmental Group on Indonesia (IGGI — see 
Glossary) disbanded at Indonesia's insistence, replaced with Consulta- 
tive Group on Indonesia (CGI — see Glossary) without Dutch participa- 
tion. 

Sixth general elections confirm Golkar majority. 

Indonesia assumes chairmanship of the Nonaligned Movement during 
Jakarta Summit. 

Suharto reelected to sixth term as president, General Try Sutrisno 
elected as vice president, by MPR. 

Governments bans Tempo and other prominent news magazines. 

Indonesia and Australia sign security cooperation agreement. 

Government closes ousted opposition leader Megawati Sukarnoputri's 
PDI headquarters in Jakarta; widespread rioting, looting, and arson 
ensue in capital and later spread across Java and elsewhere. 

Seventh general elections confirm Golkar majority. 

Amidst stock market panic, Indonesia-International Monetary Fund 
(IMF) agreement leads to closure of 16 Indonesian banks and restriction 
of credit. 

Economic crisis deepens as foreign reserves dramatically shrink. 

Suharto reelected to seventh term as president, Bacharuddin J. (B. J.) 
Habibie elected as vice president, by MPR. 



xxvi 



Table B. 

May 12-14, 1998 

May 21, 1998 
January 28, 1999 
June 7, 1999 
August 30, 1999 

September 16, 1999 
October 20, 1999 
February 1,2001 
July 23,2001 
May 20, 2002 
August 3, 2002 

October 12, 2002 
August 5, 2003 
April 5, 2004 

July 5, 2004 

September 9, 2004 
September 20, 2004 
October 20, 2004 
December 26, 2004 

March 28, 2005 

October 1,2005 
November 13, 2006 
September 6, 2007 

December 3-14, 2007 
January 27, 2008 
July 8, 2009 



Chronology of Important Events (Continued) 

Following shooting of Trisakti University students by security forces, 
rioting in Jakarta leads to mob-led destruction in Chinese Indonesian 
community, closure of foreign embassies, and more than 1 ,000 deaths. 

Suharto resigns from presidency; succeeded by Vice President B. J. 
Habibie. 

People's Representative Council (DPR) approves major changes to elec- 
tion laws, sets scene for June 7 national legislative elections. 

First democratic parliamentary elections since 1955 held; Megawati's 
PDI-P wins 34 percent, Golkar 22 percent. 

78.5 percent of Timor Timur voters in UN-supervised referendum reject 
broad autonomy from Indonesia, allowing province to become indepen- 
dent. 

Indonesia abrogates 1995 security cooperation agreement with Australia 
over latter 's involvement in East Timor. 

Abdurrahman Wahid elected to presidency and Megawati Sukarnoputri 
to vice presidency by MPR. 

Wahid censured by DPR for involvement in financial scandals; censured 
again April 30. 

Wahid resigns amidst MPR impeachment proceedings; Megawati sworn 
in as fifth president. 

Timor Timur Province (East Timor) becomes independent nation of 
Timor-Leste. 

MPR amends constitution to allow direct election of president and vice 
president; provides for new legislative body, the Regional Representa- 
tive Council (DPD). 

202 die, more than 300 injured in terrorist bombings in Kuta tourist dis- 
trict in Bali. 

14 killed, 149 injured in terrorist car bombing at JW Marriott hotel in 
Jakarta. 

Elections held for DPD, DPR, and representatives for all provincial, 
regency, and municipality-level legislatures; Golkar wins 21 percent, 
PDI-P 18 percent. 

Initial round of Indonesia's first direct popular election for president and 
vice president held; Susilo Bambang Yudhoyono wins 33 percent of 
votes to Megawati's 26 percent. 

Terrorist suicide car bombing at Australian Embassy in Jakarta, kills 9, 
wounds 180. 

Susilo Bambang Yudhoyono receives 60.9 percent of popular votes in 
presidential runoff election. 

Yudhoyono sworn in as sixth president of Indonesia, Muhammad Yusuf 
Kalla sworn in as vice president. 

Tsunamis devastate coastal areas throughout the Indian Ocean, killing 
166,561 persons and displacing 203,817 in northern and western coastal 
areas of Sumatra. 

Earthquake strikes Nias and other nearby islands, Sumatera Utara Prov- 
ince, killing 1,300 and displacing 40,000. 

26 die, 129 injured by suicide attacks in Jimbara and Kuta, Bali. 

Indonesia and Australia sign security agreements. 

Russia's President Vladimir Putin signs arms agreement with Susilo 
Bambang Yudhoyono while visiting Jakarta. 

UN Climate Change Conference held in Bali. 

Former President Suharto dies in Jakarta hospital. 

Yudhoyono reelected for second term as president with 60.8 percent of 
the first-round vote. 



xxvii 



Table B. Chronology of Important Events (Continued) 



July 17, 2009 

September 30, 2009 
December 30, 2009 
May 2010 
August 2010 



October-November 2010 

April 15, 2011 
July 2011 



August 2011 



Two suicide bombers kill 7, injure 53 at Ritz-Carlton and JW Marriott 
hotels in Jakarta. 

7.6-magnitude earthquake strikes Padang, Sumatera Barat Province. 
Former President Wahid dies in Jakarta hospital. 
Indonesia conducts national census. 

According to preliminary census data, population of Jakarta calculated 
at 9.58 million or nearly 4 percent of the national population of 237.6 
million, surpassing all forecasts. Authorities discuss eventually moving 
government to new satellite town. 

Eruptions of Mount Merapi, Jawa Tengah Province, kill more than 300 
and displace more than 135,000. Underwater earthquake of 7.7 magni- 
tude and tsunami near Mentawai Islands, Sumatera Barat Province, kill 
more than 300 and displace 16,000. 

Suicide bombing of a mosque inside a police compound in Cirebon, 
Jawa Tengah, during Friday prayers. 

Indonesia's two largest Muslim organizations — Nahdlatul Ulama and 
Muhammadiyah — with combined memberships of 1 10 million, publi- 
cally condemn Islamic radicalism and use of violence. 

Following August 2 rallies in Jayapura, Papua Province, and other loca- 
tions, condemning 1969 Act of Free Choice and calling for referendum 
on independence from Indonesia, Free Papua Organization (OPM) 
attacks Indonesian armed forces troops. 



xxviii 



Table C Metric Conversion Coefficients and Factors 



When you know 

Millimeters 

Centimeters 

Meters 

Kilometers 

Hectares 

Square kilometers 

Cubic meters 

Liters 

Kilograms 

Metric tons 

Degrees Celsius (Centigrade). 



Multiply by 


To find 


0.04 


inches 


0.39 


inches 


3.3 


feet 


0.62 


miles 


2.47 


acres 


0.39 


square miles 


35.3 


cubic feet 


0.26 


gallons 


2.2 


pounds 


0.98 


long tons 


1.1 


short tons 


2,204 


pounds 


1.8 


degrees Fahrenheit 



and add 32 



Country Profile 




Country 

Formal Name: Republic of Indonesia (Republik Indonesia; the word 
Indonesia was coined from the Greek indos — for India — and nesos — 
for island). 



Short Form: Indonesia. 



Term for Citizen(s): Indonesian(s). 
Capital: Jakarta 

Date of Independence: Proclaimed August 17, 1945, from the Neth- 
erlands. The Hague recognized Indonesian sovereignty on December 
27, 1949. 



xxxi 



Geography 



Size: Total area 1,904,569 square kilometers, of which land area is 
1,811,569 square kilometers and water area 93,000 square kilometers. 
Indonesia claims total sea area of 7.9 million square kilometers, 
including an exclusive economic zone. 

Topography: Largest archipelagic nation in world, Indonesia encom- 
passes 17,508 islands, five main islands, two major archipelagoes, and 
about 60 smaller archipelagoes. Larger islands are mountainous, with 
some peaks reaching 3,800 meters above sea level on western islands 
and more than 5,000 meters on Papua. Highest point is Puncak Jaya 
(5,030 meters) on Papua. The region is tectonically unstable, with some 
400 volcanoes, 100 of which are active. 

Climate: Maritime equatorial climate with high, even temperatures 
and heavy rainfall; temperatures and rainfall vary across the archipel- 
ago because of elevation and monsoon patterns. Average temperatures 
at or near sea level range from about 23° C to 3 1° C. 

Society 

Population: 245,613,043 estimated by U.S. government in July 2011 
(237.6 million according to preliminary 2010 census figures released in 
August 2010); annual growth rate of 1.1 percent. In 2011 birthrate esti- 
mated at 18.1 births per 1,000, death rate 6.2 per 1,000, sex ratio at 
birth 1 .05 males to each female. Approximately 52 percent of popula- 
tion living in urban areas, about 4 percent in Jakarta. Average popula- 
tion density 135 per square kilometer, with wide regional variation. 

Ethnic Groups: About 350 recognized ethnolinguistic groups, 180 
located in Papua; 13 languages have more than 1 million speakers. 
Javanese 41 percent of population, Sundanese 15 percent, coastal 
Malays 3.4 percent, Madurese 3.3 percent, and others 37.3 percent. 

Languages: Official national language Bahasa Indonesia (or Indone- 
sian), a modified form of Malay, with estimated 17 million to 30 million 
mother-tongue speakers and more than 140 million second-language 
speakers or readers. At least 73 1 other languages and dialects also spo- 
ken, some by large numbers: Javanese (83 million), Sundanese (30 mil- 
lion), Malay/Indonesian (17 million), and Madurese (nearly 6.7 million). 
Other languages with more than 1 million speakers each are Acehnese, 
Balinese, Banjarese, Batak (including Toba), Batawi, Buginese, Minang- 



xxxii 



kabau, and Sasak; also various Chinese dialects. English widely used in 
government and business circles. 

Religion: Indonesia largest Islamic population in world; per 2000 cen- 
sus most Indonesians (86.1 percent) Muslims (mostly Sunni — see 
Glossary) and observe Islamic practices to varying degrees; another 5.7 
percent Protestant, 3 percent Roman Catholic, 1.8 percent Hindu, 3.4 
other, including Buddhist, and unspecified religions. Animism prac- 
ticed in some remote areas. 

Health: Life expectancy estimated in 2011 at 71.3 years overall (68.8 
years for males, 73.9 for females). Infant mortality 27.9 per 1,000. 
Recent data unavailable, but figures estimate 0.1 physicians, 0.8 nurses 
or midwives, and 0.6 hospital beds for every 1,000 inhabitants. Per- 
capita health expenditure in 2006 was 2.2 percent of gross domestic 
product (GDP — see Glossary), lowest among members of Association 
of Southeast Asian Nations (ASEAN — see Glossary). 

Education and Literacy: Twelve-year public and private primary and 
secondary education system; the first nine years mandatory. In 2008 
primary and secondary education, both private and public, included: 
63,444 kindergartens, 144,228 six-year primary schools, 28,777 junior 
secondary schools, 10,762 general senior secondary schools, and 7,592 
vocational senior secondary schools, enrolling total of 45.4 million stu- 
dents taught by 2.9 million teachers. Special education schools, for the 
physically and mentally disabled, numbered 1,686, with 73,322 stu- 
dents and 18,047 teachers. Higher education offered in 2,975 colleges, 
universities, and other tertiary institutions, with more than 4.2 million 
students. Adult literacy rate 90.4 percent in 2009. 

Economy 

Major Features: Following fast-paced growth during most of the 
New Order period (1966-98) and decline during and following 1997— 
98 Asian financial crisis, Indonesian economy characterized by 
decade of reform aimed at the financial sector and corrupt politicians 
and managers. Recent improvements in international trade, aid, and 
payments; in employment and income development; plus continued 
reorientation from agriculture to industry; and within the industrial 
sector itself, from oil and gas production to other manufacturing 
branches. Services, transportation, and communication sectors making 
greater contributions to economic growth. 



xxxiii 



Gross Domestic Product (GDP): In 2010 estimated at US$1.03 tril- 
lion; per-capita income based on GDP estimated in 2010 at US$4,200. 
GDP by sector, based on 2010 U.S. Government estimates, agriculture 
15.3 percent, industry 47.1 percent, and services 37.6 percent. 

Agriculture: Principal crops: cassava, cocoa, coconuts, coffee beans, 
corn, palm oil, rice, rubber, tea, and tobacco. Livestock: buffalo, cattle, 
goats, horses, pigs, poultry, and sheep. Inland and marine fishing valu- 
able sources of domestic protein and export. Forestry also important. 

Industry and Manufacturing: Oil and gas, food production, textiles, 
automobiles and other transportation equipment, electrical appliances, 
and chemical products. 

Natural Resources: Bauxite, coal, copper, gold, natural gas, nickel, 
petroleum, and tin. 

Exports: US$158.2 billion free on board estimated 2010. Major com- 
modities (in order of importance): oil and gas, electrical appliances, 
plywood, textiles, rubber. Japan, China, United States, Singapore, 
South Korea, India, and Malaysia largest trading partners. 

Imports: Totaled US$127.1 billion (cost, insurance, and freight) esti- 
mated 2010. Major imports (in order of importance): machinery and 
equipment, chemicals, fuels, foodstuffs. Singapore, China, Japan, United 
States, Malaysia, South Korea, and Thailand main trading partners. 

Exchange Rate: US$ 1=8,48 1.76 rupiah at the end of July 2011. 

Fiscal Year: Calendar year. Prior to 2001, the fiscal year ran from 
April 1 to March 3 1 . 

Transportation and Telecommunications 

Inland and Coastal Waterways and Ports: 21,579 kilometers of navi- 
gable rivers, canals, and inland waterways. Extensive interisland and 
coastal maritime routes. Total 379 ports and harbors: deep-sea ports at 
Tanjung Priok (Jakarta), Tanjung Perak (Surabaya, Jawa Timur Prov- 
ince), Belawan (Medan, Sumatera Utara Province), and Makassar 
(Sulawesi Selatan Province); other major ports at Cilacap, Cirebon, and 
Semarang (all on Java), Dumai (Riau), Balikpapan (Kalimantan Timur), 
Kupang (Nusa Tenggara Timur Province), and Palembang (Sumatera 
Selatan Province); 127 ports capable of handling international shipping. 



xxxiv 



Roads: In 2008 total road network estimated at 437,760 kilometers; 
59 percent paved, about 32 percent classified as highways. 

Railroads: In 2010 some 5,042 kilometers railroad track, all govern- 
ment owned and operated; about 75 percent of railroad track located in 
Java, a minimal portion electrified. In 2007 some 175 million passen- 
gers carried, 17.3 million tons of freight transported in 2005. 

Civil Aviation: 684 airports, 171 of which had paved runways, and 64 
heliports in 2010. In 2004 more than 263 million kilometers flown, 
26.7 million passengers carried (increased to 3 1 million in 2007), and 
2.9 trillion tons-kilometers transported. State-owned domestic and 
international carrier Garuda Indonesia; subsidiary, Merpati Nusantara 
Airlines. Twenty-seven privately owned companies. 

Pipelines: In 2010 Indonesia had pipelines as follows: 12 kilometers 
oil/gas/water, 44 kilometers water, 73 kilometers condensate/gas, 812 
kilometers condensate, 1,370 kilometers refined products, 5,984 kilo- 
meters oil, and 7,165 kilometers gas. 

Telecommunications: Some 7,000 local and regional radio stations, 
only 6 broadcast nationally; 11 national television channels, TVRI 
state-owned; 100 local television stations (2008). More than 20 million 
Internet users (2009). 

Print Media: More than 50 principal daily newspapers published 
throughout archipelago, majority in Java; largest readership Kompas 
(Jakarta), circulation of 523,000; largest English-language dailies, 
both published in Jakarta, Jakarta Post and Jakarta Globe, both with 
print runs of 40,000. 

Government and Politics 

Party and Government: Republic based on separation of powers 
among executive, legislative, and judicial branches. Constitution of 
1945 in force but amended in 1999-2002 to make once powerful, party- 
centered presidency subject to popular election and limited to two five- 
year terms. President and vice president elected on single ticket, usually 
representing coalition of parties; winning ticket must gain more than 60 
percent of popular vote in the first round of voting and at least 20 per- 
cent of vote in half of provinces. If percentages not met, second-round 
runoff election held. President both chief of state and head of govern- 
ment. Legislative power vested in People's Representative Council 
(DPR) and less-powerful upper house, Regional Representative Council 



xxxv 



(DPD). People's Consultative Assembly (MPR), which formerly elected 
the president and vice president, now joint sitting of the DPR and DPD 
but retains separate powers restricted to swearing in president and vice 
president, amending constitution, and having final say in impeachment 
process. Newly decentralized power of subnational authorities en- 
shrined and delineated in amended constitution. Numerous political par- 
ties; Democrat Party (PD), Partai Golkar (Golkar Party), and Indonesian 
Democracy Party-Struggle (PDI-P) gained largest number of DPR 
seats in 2009 election. 

Administrative Divisions: Thirty-three provincial-level units: 30 
provinces (propinsi), two special regions (daerah istimewa; Aceh and 
Yogyakarta), and one special capital city region (daerah khusus; 
Jakarta). Provinces subdivided into districts, called municipalities 
(koto) in urban areas and regencies (kabupaten) in rural areas; below 
are subdistricts (kecamatan), with village (desa) at lowest tier. Indone- 
sia in 2009 had 348 regencies, 91 municipalities, 5,263 subdistricts, 
and 66,979 villages. 

Judicial System: Complex system with three inherited sources of law: 
customary or adat law, Islamic law (sharia), and Dutch colonial law. 
Judicial branch independent and coequal with executive and legislative 
branches, with Supreme Court and Constitutional Court at apex of judi- 
cial system. Four different court systems below Supreme Court: courts 
of general civil and criminal jurisdiction, religious courts, state admin- 
istrative courts, and military courts. 

Foreign Relations: Founding member of ASEAN in 1967, encourages 
regional solidarity among members while expanding relations with 
other regional and global powers. Tenuous but slowly improving rela- 
tions with immediate non- ASEAN neighbors (Papua New Guinea and 
Timor-Leste) and working interdependencies with Malaysia and Singa- 
pore. Mutual suspicions color relations with Australia. Relations with 
China, once poor, warmer in recent years; trade important, as it also is 
with Japan and South Korea. Relations with United States warm and 
trade important. 

National Security 

Armed Forces: Indonesian National Armed Forces (Tentara Nasional 
Indonesia — TNI) had about 302,000 active-duty personnel in 2009, 
with army (TNI — Angkatan Darat), 233,000; navy (TNI — Angkatan 
Laut), 45,000, of which 20,000 marines and 1,000 part of naval avia- 



XXXVI 



tion; and air force (TNI— Angkatan Udara), 24,000, of which 4,000 
"quick-action" paratroopers. 

Military Budget: US$3.4 billion, just over 1 percent of budget by 
2009. 

Military Units: Army — 12 military regional commands (Kodams), 
each with one or more battalions, one of which is quick-reaction bat- 
talion; and two centrally controlled army strike force commands — 
Army Strategic Reserve Command (Kostrad) with two divisions and 
Army Special Forces Command (Kopassus), with three operational 
groups. Navy — two fleet commands (Eastern Fleet at Surabaya and 
Western Fleet at Jakarta), marine corps, air arm, and military sealift 
command. Air Force — three operational commands (Ko-Op I/West, 
Ko-Op II/East, and National Air Defense Command) and two support 
commands (Air Materiel Command and Air Training Command); four 
battalions of "quick-action" paratroopers. 

Military Equipment: Army — light tanks, armored reconnaissance 
vehicles, armored personnel carriers (APCs), towed and self-propelled 
artillery, air defense guns, surface-to-air missiles, fixed-wing aircraft, 
helicopters. Navy — submarines, frigates, patrol and coastal combat- 
ants, mine warfare ships, amphibious forces ships, non-combatant 
fixed-wing aircraft, armed helicopters, transport helicopters; marines 
have light tanks, anti-infantry fighting vehicles, APCs, towed artillery 
pieces, air defense guns. Air Force — combat aircraft, maritime recon- 
naissance aircraft, tankers, transports, trainers, helicopters. 

Auxiliary Forces: Many former official and unofficial paramilitary 
forces disbanded or integrated with TNI since 1999. National Police of 
Indonesia (Polri), since 1999 independent of TNI, numbered 280,000 
in 2009. 



xxxvii 




xxxviii 



Introduction 



ON THE EVENING OF JUNE 18, 2009, tens of millions of Indone- 
sians settled in front of their televisions to watch three candidates — for- 
mer Vice President and President Megawati Sukarnoputri, incumbent 
Vice President Muhammad Yusuf Kalla, and incumbent President 
Susilo Bambang Yudhoyono — debate major issues prior to the presi- 
dential election to be held on July 8. By all accounts, the audience was 
largely disappointed. Megawati, daughter of Sukarno, the often-radical 
nationalist and fiery orator who was Indonesia's first leader, discussed 
the national challenges of getting motorcyclists to wear helmets and 
government offices to issue identification cards in a timely fashion. 
Yusuf Kalla, whose background is in business, spoke about the neces- 
sity of setting goals and deadlines but mentioned no specifics or priori- 
ties. President Yudhoyono, a former army general, emphasized the 
need for the rule of law, lest Indonesia be compared unfavorably to 
countries with better legal systems, and he proposed more online sys- 
tems for identification cards and drivers' licences so that identities 
could be checked and "people can see what is normal and what is not." 
Many ordinary people who watched said they were simply bored, miss- 
ing real clashes of opinion and discussion of large issues such as the 
economy and human rights. Some, while not especially excited, did say 
the debates changed how they would vote, while others admitted that, 
as a result of watching the debates, they had decided to abstain from 
voting altogether. 

The next day, however, popular columnist and media figure Wimar 
Witular noted that while he agreed the debate had been "neither inspir- 
ing nor exciting," that was not the important point. "Eleven years ago," 
he wrote, "it would have been a Star Trek-like fantasy [to think] that 
presidential candidates would someday engage in an open debate on 
national television." However "boring" or overcautious, and despite the 
failure of the candidates to engage each other on large and substantive 
matters, it had been a historic event. In contrast to a political history 
dominated by commanding, larger-than-life figures like Sukarno and 
Suharto, Indonesian political decisions were now in the hands of a 
broad electorate, voting for presidential candidates who were undeni- 
ably "ordinary" people. This was an impressive step in the nation's jour- 
ney from authoritarianism to democracy, and should not be forgotten. 

It is not entirely clear whom Wimar Witular was intent on reminding, 
since his article appeared in Indonesia's foremost English-language 



xxxix 



newspaper, The Jakarta Post, and the foreign community, curiously 
enough, has generally marveled over the changes of the past decade 
more than Indonesians themselves. Whatever the case, his point was 
well taken. Since the late 1990s, Indonesia has shifted politically from 
being the world's largest military-dominated authoritarian state to being 
the world's third-largest civilian democracy (after India and the United 
States) and the largest Muslim-majority democracy, holding the world's 
largest direct presidential elections. It has gone economically from the 
heights of the "Asian miracle" of the 1960s to the 1990s to the depths of 
the Asian financial crisis of 1^97-98 — in which the national currency 
lost as much as 70 percent of its value, and income per capita fell an 
estimated 40 percent — and back, by mid-2009, to heights of growth at 
which it was deemed the best-performing Asian market for the year and 
third-fastest-growing economy, placed by some analysts in the com- 
pany of the "emerging giants" of Brazil, China, India, and Russia. 
Administratively, Indonesia has moved from being one of the world's 
most centrally controlled regimes to being one of the most decentral- 
ized. Finally, contrary to the expectations of many careful observers, 
both foreign and domestic, Indonesia has succeeded in the past decade 
in preserving the territorial state virtually intact against the considerable 
forces of separatist movements. The exception is East Timor — now the 
Democratic Republic of Timor-Leste — acquired by force in 1976 and 
relinquished under pressure in 1999. Indonesia has also faced severe 
ethnic and religious violence, growing internationally influenced 
Islamic terrorism, tension over — and within — the armed services, and a 
series of natural disasters of which the most devastating was the 2004 
tsunami that killed more than 166,500 Indonesians, mostly in the trou- 
bled region of Aceh, in northern Sumatra. 

Trying to account for these enormous accomplishments has for 
some time occupied Indonesia watchers ranging from serious, aca- 
demic specialists to commentators with varied and comparatively 
casual interests in the country and its people, to say nothing of Indone- 
sians themselves. One result has been a wave of academic and journal- 
istic writing, much of it sharply divided ideologically and theoretically. 
Indonesians from the political elite to ordinary citizens have also 
plunged into a period of unprecedented — and unprecedentedly open — 
introspection, raising a vibrant public discourse. There is no broad con- 
sensus, but the principal analyses tend to fall into four main types. 

The first takes a long-term view. According to this explanation, Indo- 
nesia's dramatic shift to a successful democratic political process con- 
firms what some had argued all along: democracy began to take root in 
the years immediately following the National Revolution (1945-49), but 
this natural, often disorderly development was nipped in the bud by the 



xl 



imposition of Sukarno's Guided Democracy (1957-65) and further sup- 
pressed by Suharto's military-backed New Order (1966-98). Proponents 
of this view dismiss arguments that newly independent Indonesians in 
the early 1950s were not "ready" for representative democracy, or that 
democracy along Western lines (what Sukarno called "free-fight liberal- 
ism" and "50 percent + 1 democracy") is somehow antithetical to both 
Indonesia's needs and its traditions. They also suggest that previous gov- 
ernments' attempts to deal with the specter of ethnic and religious con- 
flict by smothering the expression and discussion of differences rather 
than channeling and protecting them only made matters worse. The fall 
of the New Order, and with it the fall from favor of the old political elite 
and the military, made possible what was in fact a kind of "back-to-the- 
fiiture" movement: returning to what began so promisingly nearly two 
generations earlier, and this time doing it right. Indonesia's achievement 
since 1998, then, was as possible 40 years ago as it has now proven to be. 

A second explanation looks at matters from a mid-range perspec- 
tive, focusing on the previous 20 years or so. The success of Indone- 
sia's transformation thus appears due largely to the influence of 
internal dissidents and progressives — particularly educated young peo- 
ple — during the last half of the New Order and the subsequent period 
of reformasi (reform — see Glossary), coupled with pressure from both 
a general globalization and specific outside sources. Advocates credit 
this combination of forces not only with weakening and eventually 
bringing an end to Suharto's rule, but also, even more important, with 
persisting during the subsequent period of upheaval in championing 
and providing the ideas and manpower necessary for genuinely demo- 
cratic reforms. Seen in this way, Indonesia's post-New Order achieve- 
ment is to a very large degree a generational one, which, as many 
reformers are quick to point out, is very much in the tradition of Indo- 
nesia's original struggle for independence. 

A still shorter field of vision defines a third perspective, which 
focuses for the most part on the past decade. This view emphasizes the 
importance of the political and military leadership after the resignation 
of Suharto in May 1998, arguing that without it Indonesia might easily 
have continued as previously, under the sway of an authoritarian figure. 
Instead, as it happened, the individuals who followed the New Order 
president had neither the inclination nor the opportunity to attempt to 
reassemble the strongman pattern. Military leaders made conscious 
decisions to forego any thoughts of reinstating — by force or other 
means — the armed forces' self-declared dual responsibilities as both 
governors and enforcers. However great a role the architects of reform 
may have played, according to this argument, their efforts could have 
been derailed by powerful civilians and soldiers if they had been so 



xli 



inclined. But they were not derailed, and it is therefore to current mili- 
tary and political leaders, with all their strengths and weaknesses, that 
the success of the past decade must ultimately be attributed. 

A final theory suggests that the great transformation at issue has not 
(or at least not yet) taken place, and that the changes that have occurred 
are in many respects superficial. For example, a prominent analyst of 
Indonesian affairs examined the three pairs of candidates in the 2009 
presidential election and found they were all "creatures of Indonesia's 
past." Yusuf Kalla, a "classic Suharto-esque businessman" and conser- 
vative political supporter, was allied with Wiranto, a retired general who 
was Suharto's former adjutant and was indicted by the United Nations 
for crimes against humanity in East Timor. Megawati, a "woman long- 
ing for a return to the glory days of her father," had as a mnning mate 
Prabowo Subianto, another general (and former son-in-law of Suharto), 
who was dismissed by the military for brutal treatment of political activ- 
ists. Susilo Bambang Yudhoyono, yet another former general, although 
one with a reputation for liberal tendencies and indecisiveness, chose as 
his vice presidential candidate a career government economist — Budi- 
ono — who had most recently headed Bank Indonesia. All of this sug- 
gests that at best modest and largely cosmetic change has taken place 
since 1998, and that, furthermore, the prospects for deep, meaningful 
reforms in the immediate future are perhaps considerably dimmer than 
most enthusiasts are willing to admit. 

Each of these sorts of explanations has strengths as well as obvious 
weak points, and none can stand entirely on its own. Beyond the op-ed 
pieces and academic studies, in their everyday thinking most Indone- 
sians probably borrow from all of them in assembling their own con- 
clusions. Even taken together, however, it is startling that in their 
combined field of vision, the 32 years of New Order governance 
scarcely figure except as a source of obstacles to political moderniza- 
tion, a decidedly negative force in any effort to explain the advances of 
the past decade. Recently, however, a handful of commentators have 
quietly begun to raise the possibility that a powerful explanation of the 
undeniably rapid, and apparently successful, transformation since 
1998 may lie precisely where least suspected: in the policies and reali- 
ties of the New Order itself. 

A full consideration of this fifth theory would require a thorough 
reexamination of Indonesia's history in the last half of the twentieth 
century, which has yet to be undertaken. For the present, however, 
some principal points of the argument seem clear enough. The basic 
notion is that the "amazing" transformation after 1998 is not quite as 
amazing as has generally been suggested because the New Order 
regime was never as powerful and monolithic, in some views even 



xlii 



totalitarian, as many believed, and that its ability to control the way 
people thought and behaved was overestimated. (In the same vein, the 
military was never as unified or free to assert its will as most assumed.) 
From this perspective, for example, the New Order censorship about 
which critics constantly complained was on the whole much milder 
than portrayed, and at best erratic and incomplete; it certainly did not 
entirely smother public debate or expressions of discontent. Similarly, 
the regime's signature efforts to inculcate the ideology of Pancasila (see 
Glossary), which critics decried as so much self-interested, statist pro- 
pagandizing, were surprisingly ineffective, producing more cynicism 
and questioning than acquiescence, and certainly not blind adherence. 
Individuals' ability to think or act independently in political matters, 
although indeed limited under the New Order regime, was far less 
severely damaged than imagined, and did not require a miracle to 
revive. 

This explanation also suggests that the New Order may have con- 
tributed to the post- 1998 transformation in a more positive manner. It 
is not, for example, quite so astonishing that Indonesia was able to 
hold complex and reasonably peaceful elections in 1999, 2004, and 
2009 if we recall that, in fact, the nation had practice doing so for a 
quarter of a century under New Order auspices in 1971, 1977, 1982, 
1987, 1992, and 1997. This notion may be repellent to critics who 
spent years pointing out how the New Order political process was any- 
thing but free, manipulated as it was by numerous means, including 
dishonest management of elections, curtailment of party indepen- 
dence, manipulation of parliament through large appointed member- 
ships, and the like. Nevertheless, elections were routinely held and 
order maintained until the process became familiar, even taken for 
granted; it was by no means new in 1999, even though the all-impor- 
tant political context had changed. Furthermore, it seems likely that 
the millions of Indonesians who participated in those New Order elec- 
tions came to understand that process's shortcomings and to develop 
ideas about how it could be improved. There was no dearth of ideas 
when the time came to make changes, and the journey to democracy 
required modest hops rather than great leaps. 

The larger implication of this fifth sort of explanation is that what 
took place between roughly 1998 and 2004 in Indonesia was on the 
one hand not the revolution or near-revolution some saw or wished 
for, and on the other hand not the ephemeral, surface phenomenon oth- 
ers feared. There was neither miracle nor mirage but rather a complex 
transition in which continuity figured as importantly as change, and 
the two were often very closely intertwined. This insight is useful in 
understanding other aspects of contemporary Indonesia beyond elec- 
tions and democratic procedure. 



xliii 



One illustration concerns the promotion of Pancasila ideology, a 
widely criticized hallmark of the New Order that appeared to have 
been summarily abandoned in 1998. Beginning in about 2002, how- 
ever, there was a revival of interest in Pancasila and in honoring it as a 
kind of national creed and summation of national identity. Even prom- 
inent intellectuals who had considered New Order leaders' interest in a 
national ideology an anathema, and the Pancasila itself as shallow and 
outdated, appeared at symposia and on op-ed pages as advocates of a 
"revitalization," emphasizing the ways in which the message of the 
Pancasila is not only appropriate for post-New Order Indonesia, but 
indeed even necessary. In 2006 President Yudhoyono made a point of 
giving a major national speech on the then-neglected Birth of Pan- 
casila Day (June 1), recommending that politicized niggling over the 
historical origins and other details surrounding the Pancasila — which 
he described as the "state ideology" — cease and that greater attention 
be paid to its precepts. There were numerous calls for making June 1 a 
national holiday, and the minister of education said that the Pancasila 
would remain part of the curriculum. It looked very much as if a key 
element of the New Order was about to be reinstated. 

The president made a special effort, however, to emphasize that he 
did not intend to return to the past. The authoritarian Suharto govern- 
ment had, he said, "twisted the ideology to promote conformity and 
stifle dissent" with what he termed "Pancasila brainwashing," which 
caused the populace to turn against it and its sponsors. But in reality, 
he said, the Pancasila is "not an absolute doctrine but a compromise 
reached by the nation's founding fathers," and it should be accepted as 
such, not as a sacred document used to enforce uniformity. It is a com- 
promise that sees all Indonesians as equal and protects pluralism and 
tolerance; it supports democratic reform and human rights, at the same 
time as it promotes a sense of unity under a common sense of social 
justice. This is precisely what is needed, Yudhoyono argued, at a time 
when rapid political decentralization and vigorously competing ethnic 
and religious identities threaten national unity. Whatever the degrees 
of public trust in Yudhoyono 's message, it will, of course, be some 
time before it is clear where it will lead. Nevertheless, making the 
effort to see elements of change where continuity is most apparent at 
least brings observers closer to the realization that an easy, either/or 
reading is inadequate. 

A second illustration concerns contemporary Indonesian public cul- 
ture. By mid-2009, after a comparatively short period of growth 
beginning around 2006, by far the most popular television genre in the 
nation was the reality show — dating shows, talent contests, extreme 
home makeovers, and the like — which are widely seen as being Amer- 



xliv 



ican in origin (although in fact British and Dutch producers were the 
true pioneers); nearly 80 different shows of this type were being pro- 
duced by local companies. To both outsiders and many Indonesians, 
this seemed to be a sign of an abrupt change. The Indonesian scholar 
and public intellectual Ariel Heryanto, for example, suggested that the 
pendulum had swung away from a post- 1998 interest in Islamic popu- 
lar culture, and he talked about American culture being suddenly "in" 
among Indonesians at all economic and social levels. One reality- 
show producer even suggested that what viewers consider American 
values are in fact universal ones, and that Indonesians are now part of 
a world in which everyone shares "the same dream, no matter who 
you are and what nationality you are." Not surprisingly, some Western 
commentators took this as another confirmation that Indonesia had 
moved definitively into the liberal democratic camp. 

There is an important "continuity" side to this story as well. For one 
thing, as New York Times reporter Norimitsu Onishi pointed out, the 
reality show is not the first American genre to attract attention. Ameri- 
can sitcoms ranging from "I Love Lucy" to "The Golden Girls," as 
well as series such as "McGyver," filled Indonesian television sched- 
ules beginning in the mid-1970s but then lost ground to shows with 
Islamic themes and to telenovelas from Latin America and soap 
operas from Asia; the current fascination with televised reality shows 
is thus part of a longer evolution and should be interpreted in that light. 
The careful foreign viewer might also notice that a number of the most 
popular Indonesian reality shows focus on themes markedly not found 
in America — for example, transplanting wealthy or upper-middle- 
class Indonesians into poor, rural settings, and vice versa, focusing on 
the tribulations each group faces in making adjustments and attempt- 
ing to understand an altogether different way of life. These produc- 
tions tend to validate the values of modern, urban middle-class 
Indonesians at the same time as they highlight the importance of 
empathy for others, reflecting in part a longstanding mainstream 
nationalist populism and in part a Muslim morality and sensitivity to 
the plight of the poor. The analysis that the popularity of such reality 
shows is evidence of a recent and dramatic social change — "Ameri- 
canization," even — is neither as accurate nor, truth be told, as interest- 
ing as the more complicated view that notices a more complex story of 
adaptation. 

Since the previous edition of this volume in the Country Study 
Series appeared in 1993, Indonesia has experienced enormous changes 
of great significance. The purpose of this revised version is not merely 
to point them out but also to attempt to show them in their proper per- 
spective, in which changes are never without roots and continuities 



xlv 



never untouched by innovation. Particularly for a country as large, 
diverse, and historically intricate as Indonesia, this approach seems 
both necessary and sensible. 

September 16, 2009 

* * * 

As the manuscript for this book was being completed, a number of 
significant events occurred in or concerning Indonesia, most notably 
Indonesia's third post-Suharto presidential election, which was held on 
July 8, 2009. Fifteen days later, the General Elections Commission 
(KPU; for this and other abbreviations and contractions, see table A) 
declared the Democrat Party (PD) coalition candidates, incumbent 
president Susilo Bambang Yudhoyono and former Bank Indonesia head 
Budiono, the official winners as president and vice president, respec- 
tively, for the 2009-14 term. They garnered 60.9 percent of the vote. 
The election itself was largely peaceful, but not without grumbling in 
some quarters about how the KPU had managed the process. There 
were challenges to the results, particularly of massive fraud involving 
voter rosters. Megawati Sukarnoputri and her ranning mate, former 
army general Prabowo Subianto, who placed second with 26.8 percent 
of the vote, pressed the issue particularly hard, claiming that 28.5 mil- 
lion of her opponent's votes had been rendered invalid. On August 12, 
however, the Constitutional Court declared that the claims of both 
Megawati and the Golkar (see Glossary) candidate, Yusuf Kalla, 
"lacked legal basis," as the court found "no systematic, structural, and 
massive violations on the KPU's part." Although some observers 
expected further difficulties, such as violence or new procedural chal- 
lenges, the court's ruling appeared to have defused a potentially very 
troublesome issue. 

Another development was the ongoing anticorruption campaign. By 
the time of Yudhoyono's official inauguration on October 20, 2009, his 
second administration was already darkened by a storm of controversy 
that had been gathering since well before the election. The central issue 
was corruption, long considered by Indonesians and foreign observers 
alike as the nation's most serious problem, and one Yudhoyono was 
widely seen as having had some success combating by establishing in 
2002 the Corruption Eradication Commission (KPK) and Corruption 
Crimes Court (Tipikor Court). The KPK, which had been given extra- 
ordinary powers of investigation (for example, into warrantless wiretap- 
ping) and prosecution, earned public respect for achieving a conviction 
rate of 100 percent in 86 graft cases involving mostly mid- and lower-level 



xlvi 



bureaucrats and civilians. But by early 2009, the KPK had begun to take 
aim at more important targets, especially in the higher ranks of the 
National Police of Indonesia (Polri) and the Attorney General's Office. 
The KPK also became increasingly involved in investigation of the con- 
troversial US$700 million bailout in 2008 of the nation's thirteenth-largest 
bank — Bank Century — to which the new Yudhoyono government's 
finance minister, Sri Mulyani Indrawati, and vice president, Budiono, 
were connected. 

These initiatives appear to have persuaded many prominent indi- 
viduals, perhaps because they themselves were potential targets, that 
the KPK was too powerful. Representatives of Polri and the Attorney 
General's Office and groups of legislators launched a seemingly con- 
certed effort to deflate the KPK. The first important victim was the 
KPK head himself, Antasari Azhar, who in May 2010 was accused of 
masterminding a bizarre love-triangle murder plot, for which he was 
later convicted and sentenced to 1 8 years in prison. (As of late June 
2010, the case was still under appeal.) The next major erstwhile targets 
were two KPK commissioners, Bibit Samad Riyanto and Chandra 
Hamzah, arrested in October 2009 on accusations of accepting bribes 
in what by that time had become a bitter feud between the KPK and 
Polri. (That case, after an even more tortuous journey through the 
courts, was in limbo more than eight months later.) In addition, the 
Bank Century case brought accusations of wrongdoing and, implicitly, 
corruption on the part of a range of principals involved, some of whom 
were connected to KPK and Polri scandals. In all of these cases, there 
was widespread public suspicion that many of the targets had been 
framed by police, as indeed several police officers publicly testified. 

The long-term significance of these scandals is still uncertain, but 
there is general agreement about several consequences. First, President 
Yudhoyono 's standing in many circles was at least temporarily weak- 
ened, as he appeared to vacillate in the face of the legal disputes and 
interdepartmental dissension. Forced by public pressure to take action, 
he was unable to fully fend off legislators' attacks on the authority of 
the KBK and Tipikor, which, despite the retention of wiretapping and 
prosecution rights, was in other ways diluted. Yudhoyono also lost the 
political battle to keep reform-minded Minister of Finance Sri Mul- 
yani, who resigned in May 2010. (She soon accepted a high post with 
the World Bank and has been mentioned as a likely future presidential 
candidate.) The president had repeatedly complained that the scandals 
were being used to discredit him personally and remove him from 
office (impeachment was indeed being discussed in the legislature); 
however, the broad public did not appear to share this conclusion. 

Second, and probably of more lasting importance, is the unprece- 
dented degree to which high-level corruption and the struggle against it 



xlvii 



were opened to public scrutiny. Ordinary Indonesians devoured pub- 
lished accounts and watched televised news programs offering, for 
example, coverage of court proceedings and sensational whistle-blower 
testimonies, for up to three hours a day by January 2010, commanding 
more than four times the earlier viewer share of broadcast news. And it 
did not escape the notice of government bureaucrats and politicians that 
the Internet was quickly and skillfully used to mobilize public opinion, 
generally against government authorities. The most impressive mobili- 
zation arose in July 2009 when Polri commissioner general and head of 
the Crime Investigation Agency (Kabareskrim) Susno Duaji com- 
mented derisively to a journalist that the KPK trying to stand up to the 
police and Attorney General's Office was like a tiny house lizard 
(cicak) confronting a crocodile (buaya): opposition was foolish and 
doomed. Published by Tempo, the nation's foremost news magazine 
and online news source, the remark was endlessly repeated and soon 
triggered an enormous public reaction. The Internet, Facebook, and 
Twitter were used to gather hundreds of thousands of supporters of the 
KPK, while T-shirts and demonstrators' banners appeared with slogans 
such as "I'm a cicak\" and "Say no to the crocodile!" The police were 
especially humiliated, but public officials everywhere took uneasy 
notice of a newly powerful public that seemed to know what corruption 
was when they saw it and that vigorously supported efforts to combat 
both corruption and the types of authority that allowed it to exist. Sen- 
sational turns in the case by mid-2010 led to Susno, recently jailed in a 
military facility, now being praised as a heroic whistle-blower by some 
and even suggested as the next head of the KPK. Some people, how- 
ever, accused him of being deeply involved in graft and other corrupt 
practices. 

How did these developments affect public attitudes generally? 
According to one respected polling source, in the last quarter of 2009 
public distrust of the government was lower overall (28 percent) than 
it had been in the past five years but higher (33 percent) in the cities. 
The poll also found that confidence that "democracy is working" was 
nearly as high as it had ever been (78 percent), but that such confi- 
dence suffered slightly more in the cities. The conclusion that corrup- 
tion was the major problem facing the nation was reached by nearly as 
many people as ever (86 percent). Polling for the first quarter of 2010 
seemed likely to show slippage, which many in the business commu- 
nity feared would, in turn, have unwelcome economic effects. 

The power of the Internet was demonstrated not only in the corrup- 
tion scandals but also in the case of Prita Mulyasari, a young mother 
whose e-mailed complaints about a large Jakarta hospital's services 
circulated online beginning in mid-2009. Sued for defamation by the 



xlviii 



hospital, she was also taken to court in civil and criminal suits under 
the 2008 antipornography law. Public outcry, organized via Facebook, 
Twitter, and various blogs and glogs, resulted in her being found not 
guilty in the criminal suit, but Prita refused to settle the civil suit out of 
court because she felt that doing so was an admission of guilt. She lost 
the case in December 2009 and was fined more than US$20,000. An 
online campaign raised several times that amount in donated coins to 
pay her expenses and fines. The case underscored in several ways the 
enormous potential power of social networking in Indonesia, where 
the number of Facebook users is said to have increased from fewer 
than 1 million to more than 21 million (compared with Britain's 24 
million) between early 2009 and mid-2010. 

One government response came from the conservative minister of 
communication and information, Tifatul Sembiring, who, in February 
2010, drafted regulations widely seen as limiting freedom of expres- 
sion; public outcry was so immediate and forceful that President Yud- 
hoyono felt compelled to warn his minister to tone down the proposed 
regulations. Some legislators agreed with Tifatul, however, calling for 
strengthened limitations in laws governing multimedia use, violations 
of which are already subject to greater penalties than those in print 
media. There has been considerable pushback on the issue from a vari- 
ety of groups, among them the Alliance of Independent Journalists, 
and the debate gathered momentum in May 2010. During the follow- 
ing month, a sensational case developed around an explicitly sexual 
video allegedly showing the male pop singer Nazril (Ariel) Irham and 
two female media celebrities (they claimed that the individuals 
depicted simply looked like them), which was widely circulated on the 
Internet. Police scrambled to find out who uploaded the clips and 
whether the photos were indeed of the people everyone thought they 
were. (In late June, Ariel was arrested and charged with violating the 
2008 antipornography law.) Tifatul commented that the public debate 
over these "sex tapes" was like the dispute between Muslims, who 
believe that Jesus Christ was not crucified but rather that someone 
resembling him was, and Christians, who believe that Jesus Christ was 
crucified. He was immediately engulfed by a barrage of messages 
from angry Twitterers suggesting, for example, that he had been drunk 
when he made the comment; Tifatul's response (via his own Twitter 
account) was that his accuser himself must have been drunk. The con- 
troversy escalated so rapidly and in such dangerous directions that 
President Yudhoyono felt constrained to offer an opinion. In late June 
2010, he appeared to back Tifatul's call for, among other things, an 
Internet "black list" and general regulation of Internet use, lest society 
and the nation be damaged. 



xlix 



The threat of terrorist attacks against Indonesia continues, but gov- 
ernment forces appear to have successfully disrupted some significant 
sources of terror activity. On "Black Friday," July 17, 2009, a little more 
than a week after the presidential election, explosions were detonated by 
suicide bombers at two American-owned hotels in Jakarta, the JW Mar- 
riott and the Ritz-Carlton, killing seven (one of whom was Indonesian) 
and wounding 53. The bombings were widely condemned internation- 
ally and within Indonesia itself, where tolerance for terrorism had 
already been dropping noticeably. President Yudhoyono suggested that 
the terrorist acts were somehow 1 connected to the election and directed at 
him, an idea discounted by most analysts. (However, the police discov- 
ery in May 2010 of a plot to assassinate Yudhoyono on the coming Inde- 
pendence Day, August 17, lent the earlier suggestion some retrospective 
credence.) Heightened police efforts in succeeding months after the 
hotel bombings paid off. In September 2009, commandos killed Noor- 
din Muhammad Top, the Malaysian-born Islamist militant thought by 
police to have been responsible for major bombings in Indonesia since 
2002, including the recent JW Marriott and Ritz-Carlton explosions. In 
March 2010, counterterrorism forces killed Dulmatin, a Javanese bomb- 
ing masteirnind who played a prominent role in the militant Jemaah 
Islamiyah and was also connected to the Abu Sayyaf group in the Phil- 
ippines. The police received widespread approval for these efforts — as 
opposed to their involvement in various corruption scandals — and it was 
clear that the militants and their followers attracted little sympathy. Two 
Javanese villages, whose native sons were followers of Noordin and 
were also killed, refused to have them buried on village land. Finally, in 
June 2010 police killed former Indonesian soldier Yuli Harsono, sus- 
pected of planning, among other things, an attack on the Danish 
Embassy in Jakarta, and arrested Abdullah Sunata, wanted for establish- 
ing a terrorist training camp in Aceh and suspected of planning to assas- 
sinate President Yudhoyono. 

Issues having to do with the public practice of Islam continue to fea- 
ture in national news, especially in the Special Region of Aceh, where 
implementation of sharia (syariah in Bahasa Indonesia — see Glossary) 
began in 2000 and has caused intense debate since then. During the 
2009 elections, Golkar Party candidates attempted to make the wearing 
of the jilbab (Muslim woman's head covering) a political issue, in 
which the vast majority of Indonesians seemed to show no real interest. 
Polri announced a plan on August 21, 2009, to monitor sermons given 
at mosques and public gatherings, presumably for their potential to 
incite hatred or violence. There was, however, a strong public outcry, 
and the order was quickly rescinded. 

The most sensational development occurred in mid-September 
2009, when the Aceh legislative council introduced new Islamic crimi- 



1 



nal bylaws (qanun jinayat), calling for, among other things, adulterers 
(both Muslim and non-Muslim) to be stoned to death. The bylaws, 
introduced before the recently elected, more moderate legislature could 
officially be seated, drew condemnation from many sources, including, 
in early October, a council of 80 Muslim clerics, who said such laws 
were foreign and called for a presidential review. Other legal experts 
suggested, however, that the bylaws were reasonable, in that they 
reflected Indonesia's effort to recognize diversity in legal sanctions. 
Under pressure from civil society and both foreign and indigenous 
human-rights groups, the provisions had not yet been fully enacted and 
signed by the provincial governor as of mid-2010. The Department of 
Home Affairs announced its intention of requesting a Supreme Court 
review of Aceh's Islamic criminal code but had not yet done so, and 
the law remained officially in a suspended state. In the meantime, how- 
ever, Aceh's syariah police appear to have been emboldened, enforc- 
ing conservative standards of women's dress and, in several instances, 
carrying out public and brutal punishments for suspected moral crimes 
such as having premarital sex, intrusions the majority of Acehnese 
appear to resent. The struggle between religious conservatism and 
more moderate ideas and the search for a less-tense relationship 
between Aceh's autonomy — extended in 2006 as part of the settlement 
of the armed conflict there — and the requirements of the Indonesian 
state and constitution seem likely to continue for some time. 

Another controversial legal issue also attracted widespread attention. 
The controversy concerned Indonesia's 1965 Blasphemy Law, a section 
of the Criminal Code that prohibits both expression of hostility toward 
or contempt of the recognized religions and the advocacy of unorthodox 
interpretations of those religions. The law can be used to hand down 
sentences of up to five years' imprisonment, and to disband any group 
deemed unorthodox or heretical. In October 2009, a group of prominent 
Muslim intellectuals (including former President Abdurrahman Wahid), 
human-rights activists, and civic leaders requested that the Constitu- 
tional Court review the Blasphemy Law, suggesting that it violates 
guarantees of freedom of religion and threatens the tolerance and plural- 
ism fundamental to maintaining a democratic Indonesia. In April 2010, 
after several months of public debate and demonstrations, the court 
refused to conduct a full judicial review of the law, thereby upholding it. 
An eight-to-one decision by the court argued that, without anything to 
immediately replace it, the law is necessary in order to maintain social 
order and prevent religious conflicts. Conservative Muslims, who 
feared among other things that more liberal interpretations of Islam 
might be encouraged, were heartened by the decision, but an array of 
opponents feared that religious freedom, especially of minority groups, 



li 



would be further threatened. While the Constitutional Court's ruling 
suggests that legislative review and modification of the law might be 
pertinent, it seems unlikely that lawmakers will accept such a sensitive 
undertaking anytime in the near future. 

Eastern and western Indonesia have continued to experience 
repeated earthquakes. The largest of these occurred in western Java in 
early September 2009 (7.0 magnitude and at least 72 deaths), in Sumat- 
era Barat later the same month (7.6 magnitude with at least 1,100 
deaths and more than 2, 1 80 injured), and offshore from Sumatera Utara 
in April 2010 (7.8 magnitude, ho deaths). In Jawa Timur, the notorious 
Lumpur Sidoarjo (Lusi) mud volcano, which in 2006 killed 13 and 
destroyed the homes of tens of thousands of residents, was still oozing 
in 2010. International researchers argued in February that new data 
confirmed the disaster was man-made and not caused by an earthquake 
as the gas-exploration company Brantas Lapindo claimed. President 
Yudhoyono reiterated in March 2010 that he expected Lapindo to ade- 
quately reimburse all victims (the government itself had allocated more 
than US$210 million for the purpose in 2008 and 2009), but the case 
has been increasingly embroiled in legal and political controversy, and 
protests by the victims continued. 

In May 2010, scientists announced the discovery of previously 
unknown species of gecko, pigeon, and bat in the remote Foja Moun- 
tains in Papua Province, described as "perhaps the least disturbed ... 
tropical forest block on earth." On the same day, the government of 
Norway announced a US$1 billion grant to the Indonesian govern- 
ment to reduce deforestation through a series of ongoing, verifiable 
projects. Days later, President Yudhoyono issued a moratorium on 
new forest and peatland concessions, considered an encouraging first 
step in an aggressive, long-term campaign. 

Despite the many political and social problems its people face, 
Indonesia's economy appeared to perform remarkably well in 2009 
and early 2010. In May 2010, the International Institute for Manage- 
ment Development in Zurich placed Indonesia thirty- fifth on its annual 
list of the most competitive economies, jumping it ahead of seven 
other nations (the Philippines was listed thirty-ninth, and Malaysia was 
listed tenth). The economy grew a respectable 4.5 percent in 2009, and 
it was estimated to achieve 5.8 to 6 percent growth in 2010. Consumer 
expenditures were growing, but even the top strata were spending cau- 
tiously; government spending was strong, offsetting declining exports. 
Average per-capita income rose from US$1,180 in 2004 to US$4,200 
in 2010. Most important, statistics indicated that poverty was declin- 
ing: the nation's poorest stratum, earning US$65 or less a month, 
declined during roughly the same period, from about 40 percent of 



In 



society to slightly more than 20 percent. According to the latest Gini 
index (see Glossary), which measures inequality of wealth, Indonesia 
enjoyed considerably more equitable income distribution (0.36) than 
neighboring Thailand (0.42), Singapore (0.43), or Malaysia (0.46), 
although the gross domestic product (GDP — see Glossary) in all those 
countries was higher. As had been the case two decades earlier, such 
figures did not go entirely unchallenged but were widely accepted 
among economists. 

"Culture wars" also were underway. In a series of disputes with 
neighboring Malaysia over traditional cultural heritage, public voices — 
many on the Internet — became surprisingly shrill, including character- 
izations of Malaysia as "a nation of thieves," and threats of war. In mid- 
2009, a Malaysian Ministry of Tourism advertisement aired internation- 
ally on the Discovery Channel portrayed a Balinese dance as part of 
Malaysia's cultural heritage; the government subsequently withdrew 
the advertisement and apologized for what it said had been a production 
error. But the uproar nevertheless gathered steam, and by September, 
despite some Indonesian commentators' dismissal of the issue as trivial 
and an indication of Indonesian feelings of inferiority, it had become a 
cause celebre threatening diplomatic relations. Some of the sharp feel- 
ings on the Indonesian side were apparently assuaged in October when 
the United Nations Educational, Scientific, and Cultural Organization 
(UNESCO) declared batik to be part of Indonesia's intangible cultural 
heritage, adding to a similar declaration in 2008 for shadow puppet the- 
ater (wayang kulit) and the keris, an asymmetrical dagger, which many 
Malaysians had felt were at least equally theirs. 

There also were some prominent deaths. W. S. Rendra, major poet 
and playwright who achieved fame during the New Order for taking 
stands against the government, died at age 74 on August 6, 2009. For- 
mer president of Indonesia Abdurrahman Wahid, who served from 
1999 to 2001, died at age 69 on December 30, 2009. Gesang, composer 
of many keroncong (songs), among them the world-famous "Ben- 
gawan Solo," died at the age of 92 on May 20, 2010. Hasan di Tiro, 
best known for founding the Free Aceh Movement (GAM), the 1976— 
2006 movement aimed at achieving Acehnese independence, died at 
age 84 on June 3, 2010, one day after being officially reinstated as an 
Indonesian citizen. 

July 1,2010 



liii 



After the manuscript for this book was completed in the summer of 
2010, a number of important events took place. One of the most significant 
was the ongoing struggle against corruption, particularly that involving pol- 
iticians and government bureaucrats. Public opinion appeared to stiffen fur- 
ther against corruption. In August 2010, not long before the traditional time 
of forgiveness at the end of the Muslim fasting month of Ramadan, Presi- 
dent Yudhoyono issued pardons and remissions of sentences for a number 
of individuals convicted of graft, most of whom had served 75 percent or 
more of their sentences. Although such pardons are generally seen as cus- 
tomary, in this instance Yudhoyono was strongly criticized, and the ques- 
tion was asked more sharply than in the recent past whether he was indeed 
committed to the struggle against corruption. The Corruption Eradication 
Commission (KPK), which had been viewed by many as seriously weak- 
ened in early 2010 by legislative efforts to rein in its powers, appeared to be 
holding its own. Despite a call in July 2011 by People's Representative 
Council (DPR) speaker Marzuki Alie (from President Yudhoyono 's own 
Democrat Party) for the dismantling of the agency, the People's Consulta- 
tive Assembly (MPR) moved to establish the KPK more firmly with a con- 
stitutional amendment. 

Meanwhile, the KPK itself continued to pursue suspects and attempt 
to bring them to justice. The case of former police commissioner Susno 
Duaji, the self-proclaimed whistle-blower suspected of widespread cor- 
rupt practices, proceeded with many sensational twists. Formally 
charged in late September 2010 as the ringleader in a number of impor- 
tant graft cases, Duaji 's trials were just beginning 10 months later in 
mid-2011. The most important new case was that of Gayus Halomoan 
Tambunan, a midlevel tax official who said he was a witness who had 
been prepared to testify against corrupt officials but was betrayed by 
the KPK. He claimed he altered the tax forms of 149 corporations, 
including Chevron and Ford, and received Guyanese passports from a 
U.S. Central Intelligence Agency (CIA) agent working for the KPK. 
Gayus was sentenced to seven years in prison in one case, but, as of late 
July 2011, three other cases against him were still pending. Another 
major suspect in multiple corruption charges was former Democrat 
Party treasurer Muhammad Nazaruddin, who had spectactularly eluded 
arrest and even had the entire country scanning television commercial 
jingles for clues as to his whereabouts. 

The legal troubles of male pop singer Nazril (Ariel) Irham, who was 
charged with violating the 2008 Information and Electronic Transaction 
Law for appearing in sexually explicit videos that were widely circulated 
online, held the attention of many Indonesians in late 2010 and 2011. 
The reason for the high degree of interest was that it revealed many lev- 
els of hypocrisy in society's views of sex and morality, and more broadly 



liv 



because it tested the limits of openness and personal freedoms in the new 
democracy. Arrested in mid-2010, Ariel was tried in January 2011 in a 
Bandung court, where 1,000 police officers were deployed to maintain 
security and order. He was sentenced to three and a half years in prison 
and a fine equivalent to US$27,500; an appeal was rejected in April. The 
case was used by the conservative minister of the Department of Com- 
munications and Information, Tifatul Sembiring, to garner support for 
his efforts to force Internet providers to filter out pornographic content. 
Providers complained that filtering would cost them more than US$1 10 
million to implement and was, in any case, ineffective technologically. 
Nevertheless, the government persisted, even pressing the Canadian 
company, Research in Motion, to block porn from its Blackberry ser- 
vice. The government also attempted to enforce more widely a 2008 law 
that criminalizes viewing, owning, downloading, and distributing por- 
nography, with sentences of up to six years in jail and fines of up to 
US$115,000. 

But, by April 2011, it was unclear whether Indonesia's efforts to 
control Internet usage and public morality in this way could be sus- 
tained. The government's attempts — not least those by Minister Tifatul 
himself — were widely ridiculed, and the department was forced to 
admit publicly both that filters did not work very well and that it had 
only 40 staff available to monitor the issue — a clearly inadequate num- 
ber. Respected lawmaker Arifmto of the Prosperous Justice Party 
(PKS), which had strongly supported the 2008 antipornography law, 
was caught watching pornography during a legislative session; he 
promptly resigned, but columnists and others wondered aloud why an 
entertainer had gone to jail but a legislator had not been charged, and 
they mused that a high percentage of the Indonesian population was 
now in danger of being declared criminals. 

In early 2011, the aforementioned Jakarta housewife, Prita Mulya- 
sari, was partially vindicated by the Supreme Court, which overturned 
a 2010 ruling that, although she was declared not guilty in a criminal 
suit, she was liable in a civil suit that fined her more than US$20,000. 
In 2009 the Supreme Court had also denied the hospital's libel suit ask- 
ing US$250,000 in damages, but in July 201 1 it granted a prosecutor's 
request for an appeal and reversed its opinion, finding Prita guilty and 
sentencing her to six months in prison. Prita immediately filed for a 
case review, but there was such widespread condemnation of the deci- 
sion and of the judicial system as a whole that some editorials foresaw 
that the case might eventually force both abandonment of the 2008 law 
and broad judicial reform. 

There is evidence that views of the Suharto era are being modified 
in public memory and thinking about contemporary society. Calls for 
the promotion of Pancasila, which had become a hated feature of the 



lv 



Suharto era, continue to surface, and the government has announced 
its intention to revitalize the philosophy, but without saying how it 
would do so. The humanist thinker Radhar Panca Dahara acknowl- 
edged that most Indonesians still do not understand Pancasila, but he 
cautioned that interpretation has to be individual rather than codified 
to be effective. A member of the government commission overseeing 
culture and education initiatives suggested that Pancasila could best be 
revived by encouraging exemplary behavior rather than endless dis- 
cussion. Youth activist Melki Lakalena proposed that, rather than any 
sort of rigid indoctrination, popular music and other forms of mass 
culture could be used as vehicles for reawakening interest in Pan- 
casila. He said his suggested approach was a more "relaxed" way of 
recognizing "the political role of culture in disseminating the value of 
the state ideology," a statement with an oddly back-to-the-future ring. 

Another feature of both the Old Order and the New Order that, after 
a brief eclipse, showed signs of returning was the government's use of 
book banning as a tool of social control. Between 1998 and 2006, no 
books had been banned, although the Sukarno-era law sanctioning 
such action remained in force. But after 2006 the practice saw some 
revival. In December 2009, the attorney general invoked a 2004 law 
(which had replaced a 1969 law based on a 1963 presidential decree) 
that did not address "banning books" but rather "supervising the circu- 
lation of printed materials" to ban five books. Among them was the 
Indonesian translation of John Roosa's Pretext for Mass Murder: The 
September 30th Movement and Suhartos Coup d'etat in Indonesia, a 
publication that the Attorney General's Office deemed disturbing to 
public order, even though it had already been in circulation in Indone- 
sia for nearly two years. By mid-2010, the Department of Justice and 
Human Rights was reviewing about 200 books considered potential 
"threats to the country's unity," 20 of them seriously. On October 13, 

2010, however, in a case brought by a group of prominent authors, the 
Constitutional Court ruled against the original 1963 decree that gave 
the Attorney General's Office the authority to place bans on specific 
titles or on an author's entire oeuvre, declaring instead that any calls 
for bans had to be made through the court system. The government 
can still proscribe certain works under a 1966 anticommunist law, and 
under the 2008 antipornography law, but the practice of book banning 
now is far more limited than in most of the past half-century. 

All of these developments suggest that Indonesians are busy adjust- 
ing — and often moderating — their views of the pre- 1998 period, 
reconsidering some aspects and rejecting others. Perhaps the most sur- 
prising evidence of this process was the nomination, in mid-October 

201 1, of former President Suharto as a "national hero," one of 10 per- 



lvi 



sons put forward by local officials. This suggestion, which was first 
made by a Jawa Tengah district head on the 1,000-day anniversary of 
Suharto's death, elicited a vigorous debate in which there was unex- 
pectedly strong support for Suharto's rehabilitation and recognition. 
Public-opinion polls noted that, although the approval rating of Indo- 
nesia's new democracy had grown from 42 percent in 1999 to 70 per- 
cent by late 2010, and few expressed any desire to return to the New 
Order, Suharto now seemed to command growing respect. In a May 
2011 survey, 41 percent named him "Indonesia's Best President." The 
government finessed the national-hero issue by choosing only two 
minority candidates connected in some way with Indonesia's struggle 
for independence, former cabinet minister Johannes Leimena, a Chris- 
tian from Maluku, and military officer Johannes Abraham Dimara, a 
Christian from Papua. 

The struggle against terrorism continues to occupy the government, 
both within the country and in cooperation with Asian neighbors. In 
March 2011, for example, Indonesian police representatives traveled to 
Pakistan with fingerprints and DNA samples to identify the recently 
arrested Umar Patek, a Jemaah Islamiyah member thought to be one of 
the masterminds behind the 2002 Bali bombings and suspected of con- 
nections to many other incidents, including an explosion in an Islamic 
boarding school in Bima, Nusa Tenggara Barat, on July 1 1, 201 1 . As of 
that date, however, Indonesia was still one of three countries vying to 
extradite him. The radical cleric Abu Bakar Ba'asyir (also known as 
Abu Bakar Bashir), who was accused of intellectual leadership of 
Jemaah Islamiyah, charged in the Bali bombings, and served two years 
in prison before his conviction was overturned by the Supreme Court, 
was again arrested in August 2010 and later charged with funding and 
coordinating a training program for a militant jihadist group in Aceh. He 
was tried in June 201 1 and sentenced to 15 years in prison. Antiterrorist 
forces maintained pressure on other suspected networks and individuals, 
but were unable to prevent several local attacks, the most disturbing of 
which probably was the April 2011 suicide bombing in Cirebon, Jawa 
Tengah Province, where a young man purportedly angry at karaoke bars 
and unregistered places of Christian worship blew himself up and 
wounded many others in a mosque located in a police station. Because it 
occurred in a place of Muslim worship and during Friday prayers, this 
event is said to have particularly shocked public opinion. 

News commentators and columnists agree that intolerance is on the 
rise. The hardline group Islamic Defenders' Front (FPI) appears 
increasingly in reports of intimidation and often violent vigilantism. 
Its members have involved themselves in local efforts to close down 
"immoral" businesses, enforce fasting during Ramadan, and protest 



lvii 



against or close down political meetings and other activities sus- 
pected — often wildly erroneously — of being communist. Apparently 
spontaneous outbreaks of violence also have occurred, such as a Feb- 
ruary 201 1 incident in Banten, Jawa Barat Province, in which a crowd 
of 1,500 people attacked and killed three members of the unorthodox 
Muslim group Ahmadiyah while police stood by. In the eventual trial, 
prosecutors charged 11 participants jointly with inciting violence and 
committing assault leading to death, but no individuals were charged 
with the actual killings. Such events pose a dilemma for both law- 
enforcement and justice officials, not only because, as Muslims, they 
often find it difficult to act against "protectors of Islam," but also 
because it is often difficult, in Indonesia's still relatively recently 
democratized society, to determine the proper boundary between free- 
dom of expression and intolerance. 

Public reaction to violent and oppressive behavior by religious zeal- 
ots appears to be increasingly negative. Growing disapproval is most 
notable where efforts to implement sharia are concerned. In Aceh, 
where in 2010 more than 800 detentions were carried out by the sharia 
police and men were forced to marry and women to have virginity 
tests, public dissatisfaction arose, and activists complained of viola- 
tions of human rights. In the Bekasi area near Jakarta, polls taken 
between April 2009 and March 2010 showed that individuals in favor 
of the local government implementing sharia dropped from 43 percent 
to 36 percent, and those who believed that thieves should have their 
hands cut off declined from 38 percent to 32 percent. This and other 
pieces of evidence may have encouraged police in some areas to take 
stronger stances with regard to civilian organizations such as the FPL 
In July 2011, for example, the Jakarta police announced they would 
take firm steps to prevent such groups from attacking businesses and 
individuals who failed to observe government regulations on certain 
kinds of entertainment during Ramadan, emphasizing that only the 
police are permitted to take such action when warranted. 

Concerns over rising intolerance and the violence it generates also 
brought Indonesia's most important Muslim associations to strengthen 
and better publicize their stands against radicalism. In its centennial 
year and with a membership of 29 million, Muhammadiyah (Followers 
of Muhammad) strongly affirmed the ideas of former leader Ahmad 
Syafii Maarif, who now promotes tolerance. Five years earlier, 
Muhammadiyah appeared to be turning in a more uncompromising 
direction. In July 2011, Muhammadiyah announced that it "conveys an 
Islam that says no to conflicts between civilizations, an Islam that fos- 
ters cooperation, dialog, a cosmopolitan Islam [that is] a golden bridge 
for a dialog between East and West." Barely a week later, Nahdlatul 



lviii 



Ulama (Council of Scholars), Indonesia's largest Muslim organization, 
with 80 million followers, celebrated its eighty-fifth anniversary by 
announcing that it would begin a campaign for a peaceful, tolerant 
Islam, and argued that "Democracy is the best tool to improve people's 
welfare and to keep the nation united." Nahdlatul Ulama's youth orga- 
nization — Ansor (Helpers of Muhammad) — also announced that, in 
response to the Cirebon mosque bombing, it was forming a special 
antiterrorist unit called Detachment 99, after the antiterrorism branch 
of the national police, Detachment 88. 

Neither unresolved social problems nor threats of turbulence seem to 
have affected economic performance. In 2010 Indonesia's economy 
grew 6.1 percent, foreign investment rose 52 percent to US$16.2 billion, 
the stock market rose 20 percent in the first half of the year, and the 
rupiah (Rp — see Glossary) appreciated nearly 5 percent against the U.S. 
dollar. In the first quarter of 2011, Moody's and Standard and Poor's 
raised the nation's sovereign debt rating to BB+, or just one level below 
investment grade. Strength within the Asian sphere was particularly 
marked. For example, the largest share of foreign investment came from 
member countries of the Association of Southeast Asian Nations 
(ASEAN — see Glossary), and, as of late 2010, Indonesia was poised to 
become the world's largest manufacturer of footwear, as more companies 
from Taiwan and South Korea relocated there. 

Still, 15 percent of Indonesia's population lives below the poverty 
line of US$1 per day. In recognition of this disparity, President Yud- 
hoyono began 201 1 by outlining the government's "growth with equity" 
philosophy of planning. Then, in a powerful and well-received special 
address entitled "The Big Shift and the Imperative of 21st Century Glo- 
balism," delivered at the World Economic Forum in Davos, Switzer- 
land, on January 27, 201 1, he called for a new sense of globalism that is 
"open-minded, pragmatic, adaptive and innovative," a globalism in 
which regional groupings play a crucial role in supplying both dyna- 
mism and restraint. The world economy, he stated, should be managed 
"so that it functions to meet our needs rather than satisfying our greed," 
and he repeated Indonesia's own national goal of "growth with equity," 
implying that the world community could well aim for something simi- 
lar. Indonesia took up the chair of ASEAN in 2011, and it was clear on 
the eve of the organization's annual meeting in late July 201 1 that Indo- 
nesia would use that opportunity to emphasize the same themes and 
enhance its growing international reputation as a political and economic 
power to be reckoned with. 

The United States has recognized the growing importance of Indone- 
sia, as well as a deepening rivalry with China for influence there. In 
November 2010, the U.S. president, Barack Obama, visited Indonesia to 



lix 



underscore the significance of improved relations between the two coun- 
tries, and to launch what was termed a U.S -Indonesian Comprehensive 
Partnership, which, it was emphasized, should be a partnership of equals, 
covering, among other things, a much-expanded program of educational 
exchange, expanded cooperation in security issues, and efforts to 
improve trade. President Obama's twice-postponed visit, although brief, 
was special because he was returning to the place he had lived for four 
years as a boy. His speech at Universitas Indonesia included lofty ideas 
on development, democracy, and religious tolerance and was quickly 
compared to his inspiring "New Beginning" speech in Cairo in 2009. But 
what the majority of Indonesians seemed to notice and appreciate most 
was that when Obama spoke about the changes that had taken place in 
Indonesia since the late 1960s, he did so first-hand and in colorful detail. 
Above all, perhaps, it was noticed that he appeared to have a genuine 
attachment to the country and its people; when he said simply, "Indonesia 
is a part of me," a great many Indonesians, including press and television 
pundits, responded emotionally. 

Indonesia continued to experience a high level of volcanic activity. 
In late August 2010, Mount Sinabung, near Karo, Sumatera Utara 
Province, erupted for the first time in 410 years, and in 2011 notewor- 
thy eruptions occurred in Java and Sulawesi. The extended series of 
eruptions at Mount Merapi in late 2010 caused evacuations of more 
than 135,000 people and more than 300 deaths near Yogyakarta. In 
addition, there were earthquakes, the largest of which occurred in Octo- 
ber 2010, when an underwater quake off the Mentawai Islands, Suma- 
tera Barat Province, registered a magnitude of 7.7 and produced a tsu- 
nami estimated to have killed more than 300 people. 

Finally, several important personalities who helped define modern 
Indonesia passed from the scene. Akhdiat Miharja, a key figure in liter- 
ature during the 1940s and 1950s, died at age 99 on July 8, 2010. Iwan 
Tirta (also known as Nusyirwan Tirtaamijaya), who had revitalized 
batik design and brought Indonesia batik international recognition, died 
at the age of 75 on July 31, 2010. Des Alwi, one of the last figures of 
the revolutionary period (he was the adopted son of Mohammad Hatta 
and a close associate of Sutan Syahrir), and later diplomat and writer, 
died just before his eighty-third birthday on November 13, 2010. Rosi- 
han Anwar, legendary reporter, columnist, and public intellectual, was 
88 when he died on April 14, 201 1. And Franky Sahilatua, who played 
an important role in popularizing voguish music of social criticism dur- 
ing the Suharto era, died at 57 on April 20, 201 1. 

August 2, 20 1 1 William H. Frederick 



lx 



Chapter 1. Historical Setting 



Relief panel at Borobudur showing a trading ship, ca. AD 800 



DEBATE ABOUT THE NATURE of Indonesia's past and its rela- 
tionship to a national identity preceded by many decades the Repub- 
lic's proclamation of independence in 1945, and it has continued in 
different forms and with varying degrees of intensity ever since. But 
beginning in the late 1990s, the polemic intensified, becoming more 
polarized and entangled in political conflict. Historical issues took 
on an immediacy and a moral character they had not earlier pos- 
sessed, and historical answers to the questions, "What is Indonesia?" 
and "Who is an Indonesian?" became, for the first time, part of a 
period of widespread public introspection. Notably, too, this was a 
discussion in which foreign observers of Indonesian affairs had an 
important voice. 

There are two main views in this debate. In one of them, contem- 
porary Indonesia, both as an idea and as a reality, appears in some 
degree misconceived, and contemporary "official" readings of its his- 
tory fundamentally wrong. In large part, this is a perspective originat- 
ing with the political left, which seeks, among other things, to correct 
its brutal eclipse from national life since 1965. But it also has been, 
often for rather different reasons, a dominant perspective among 
Muslim intellectuals and foreign observers disenchanted with the 
military-dominated government of Suharto's New Order (1966-98) 
or disappointed with the perceived failures of Indonesian nationalism 
in general. The foreign observers, for example, increasingly empha- 
sized to their audiences that "in the beginning there was no Indone- 
sia," portraying it as "an unlikely nation," a "nation in waiting," or an 
"unfinished nation," suggesting that contemporary national unity was 
a unidimensional, neocolonial, New Order construction too fragile to 
long survive the fall of that government. 

An alternative view, reflecting government-guided textbook ver- 
sions of the national past, defines Indonesia primarily by its long 
anticolonial struggle and focuses on integrative, secular, and tran- 
scendent "mainstream" nationalist perspectives. In this epic, linear, 
and often hyperpatriotic conception of the past, Indonesia is the out- 
come of a singular, inevitable, and more or less self-evident histori- 
cal process, into which internal difference and conflict have been 
absorbed, and on which the national character and unity depend. 
Some foreign writers, often without fully realizing it, are inclined to 
accept, without much questioning, the essentials of this story of the 
development of the nation and its historical identity. 

Both of these views came into question in the first decade of the 
twenty-first century. On the one hand, Indonesia's persistence for 



3 



Indonesia: A Country Study 

more than 60 years as a unitary nation-state, and its ability to survive 
both the political, social, and economic upheavals and the natural 
disasters that followed the New Order, have driven many foreign 
specialists to try to account for this outcome. Both they and Indone- 
sians themselves found reason to attempt a more nuanced reevalua- 
tion of such topics as the role of violence and the various forms of 
nationalism in contemporary society. On the other hand, a general 
recognition took hold that monolithic readings of Indonesia's 
(national) historical identity fit neither past facts nor contemporary 
sensibilities. In particular, * Indonesian intellectuals' penchant for 
attempting to "straighten out history" (menyelusuri sejarah) began 
to be recognized largely as an exercise in replacing one singular per- 
spective with another. Some younger historians have begun to ques- 
tion the nature and purpose of a unitary "national" history, and to 
search for ways to incorporate more diverse views into their 
approaches. Although it is still too early to determine where these 
realignments and efforts at reinterpretation will lead, it is clear that 
in contemporary Indonesia, history is recognized as a key to under- 
standing the present and future nation, but it can no longer be 
approached in the monolithic and often ideological terms so com- 
mon in the past. 

Origins 

Early Inhabitation 

Indonesia consists of parts of the Sunda Shelf, extending from 
mainland Asia and forming the world's largest submerged continen- 
tal shelf; a deep-water channel charting what is known as Wallace's 
Line roughly running between the islands of Kalimantan and 
Sulawesi, and between the islands of Bali and Lombok; and parts of 
the Sahul Shelf, an extension of Australia (see The Geographic Con- 
text, ch. 2). Despite arcs of frequent volcanic activity and patterns of 
rising and falling sea levels, this has been a favored region for mod- 
ern humans and their hominid predecessors for nearly 2 million 
years. Today Indonesia is of crucial importance to the study of 
human origins and evolution. Sites in central Java, such as Sangiran 
and Ngandong, now account for about 75 percent of the world's 
examples of homo erectus, an early hominid type. Most recently, the 
2004 announcement of discoveries on the island of Flores (between 
Bali and Timor) created international controversy because they sug- 
gested an entirely new, locally evolved, and distinctively smaller 
hominid form overlapping chronologically with both homo erectus 
and modern humans. 



4 



Historical Setting 



About 800,000 years ago, some early hominids of the archipelago 
made stone tools, constructed water craft sophisticated enough to 
cross 25 kilometers of rough sea channel, and may have used fire 
and language. About 600,000 years ago, a fairly sophisticated hom- 
inid culture was widely distributed throughout what is now Indone- 
sia. The earliest modern humans cannot currently be firmly dated 
before about 40,000 years ago, but some specialists argue either that 
they appeared much earlier (as much as 90,000 years ago) in a rapid 
dispersal from Africa, or that they evolved independently in East or 
Southeast Asia from existing hominid stock. Whatever the case, 
Indonesia's earliest modern humans did not immediately or every- 
where displace their hominid relatives but coexisted with them for 
tens of thousands of years. The earliest modes of their existence 
show little evidence of having deviated markedly from those of their 
predecessors. A pattern evolved of small hunting-fishing-foraging 
communities depending on tools made of shell, wood, bamboo, and 
stone, adapting to a wide variety of ecological niches and remaining 
in contact with neighboring peoples over land and sea. 

One center of these societies was in the northern Maluku and 
Papua region, where between 20,000 and about 9,000 years ago 
there is evidence of long-distance trade (for example, in obsidian, 
used for making cutting tools), deliberate horticulture, and the trans- 
port of plants (bananas, taro, palms) and animals (wallabies, flying 
squirrels) used as food sources. Possibly these communities also 
used sails and outriggers on their boats. 

Social and Cultural Developments 

About 10,000 years ago, the last ice age began to recede and seas 
rose, eventually creating from the Sunda Shelf the archipelago we 
know today. The next six or seven millennia saw the development of 
cultural and social characteristics that have been of lasting significance 
down to the present. Examples include the use throughout the archi- 
pelago of languages belonging to the same family (Austronesian); the 
spread of rice agriculture and sedentary life, and of ceramic and (later) 
metal technologies; the expansion of long-distance seaborne travel and 
trade; and the persistence of diverse but interacting societies with 
widely varying levels of technological and cultural complexity. 

There is no entirely secure understanding of how and why these 
changes took place. The most widely held view, based heavily on 
historical linguistics, argues that about 6,500 years ago peoples 
whom scholars identify linguistically and culturally as "Austrone- 
sians" dispersed out of present-day southern China and Taiwan. In a 
fairly rapid process, they spread throughout the archipelago from the 



5 



Indonesia: A Country Study 

Philippines (which they reached by 3,000 BC) to Indonesia (2,000- 
500 BC), and then farther west as far as Madagascar and farther east 
throughout the Pacific Ocean. Prehistory expert Peter Bellwood has 
characterized this dispersal as "one of the most astonishing bouts of 
colonization ... in early human history." Recent genetic and paleo- 
ecological research has raised a number of challenges to this model, 
however, among them counterindicative DNA configurations in 
archipelagic and Pacific populations of both humans and pigs, and 
indications of forest clearing in Sumatra as early as 5,000 years ago. 
These challenges suggest a more "entangled" and complicated pro- 
cess of change in which old and new populations, as well as their tra- 
ditions and technologies, interacted in many different ways over a 
long period of time. 

Evidence regarding social transformations during this period is at 
best indirect (and for Java and Sumatra, virtually absent), but caus- 
ative models from European and continental Asian prehistory seem 
rarely to apply to the archipelago. Neither knowledge of agriculture 
nor contact with outsiders always resulted in technological revolu- 
tion, for example, or rapid alteration in patterns of settlement. Politi- 
cal and economic changes occurred unevenly, and societies — in all 
likelihood small, animist chieftainships — underwent no fundamental 
transformation. Thus the archipelago came to be marked by a pattern 
of broad linguistic and cultural affinities but, at the same time, intri- 
cate diversity. Virtually all of Indonesia's subsequent history has been 
played out against the background of this remarkable human web. 

Expanding Networks 

Many parts of the archipelago played a role in local and wider 
trading networks from early times, and some were further connected 
to interregional routes reaching much farther corners of the globe. 
Nearly 4,000 years ago, cloves — which until the seventeenth century 
grew nowhere else in the world except five small islands in 
Maluku — had made their way to kitchens in present-day Syria. By 
about the same time, items such as shells, pottery, marble, and other 
stones; ingots of tin, copper, and gold; and quantities of many food 
goods were traded over a wide area in Southeast Asia. As early as the 
fourth century BC, materials from South Asia, the Mediterranean 
world, and China — ceramics, glass and stone beads, and coins — 
began to show up in the archipelago. In the already well-developed 
regional trade, bronze vessels and other objects, such as the spectacu- 
lar kettledrums produced first in Dong Son (northern Vietnam), circu- 
lated in the island world, appearing after the second century BC from 
Sumatra to Bali and from Kalimantan and Sulawesi to the eastern part 



6 



Historical Setting 



of Maluku. Around 2,000 years ago, Javanese and Balinese were 
themselves producing elegant bronze ware, which was traded widely 
and has been found in Sumatra, Madura, and Maluku. In all of this 
trade, including that with the furthest destinations, peoples of the 
archipelago appear to have dominated, not only as producers and con- 
sumers or sellers and buyers, but as shipbuilders and owners, naviga- 
tors, and crew. The principal dynamic originated in the archipelago. 
This is an important point, for historians have often mistakenly seen 
both the trade itself and the changes that stemmed from it in subse- 
quent centuries as primarily the work of outsiders, leaving Indone- 
sians with little historical agency, an error often repeated in assessing 
the origins and flow of change in more recent times as well. 

By the middle of the first millennium BC, the expansion of wet-rice 
agriculture and, apparently more importantly, certain requirements of 
trade such as the control of local commodities, suggested new social 
and political possibilities, which were seized by some communities. 
For reasons not well understood, most — and all of those that 
endured — were located in the western archipelago. Already acquainted 
with a wider world, these Indonesians were open to, and indeed 
actively sought out, new ideas of political legitimation, social control, 
and religious and artistic expression. Their principal sources lay not in 
China, with which ancient Indonesians were certainly acquainted, but 
in South Asia, in present-day India and Sri Lanka, whose outlooks 
appear to have more nearly reflected their own. This process of adop- 
tion and adaptation, which scholars have somewhat misleadingly 
referred to as a rather singular "Hinduization" or "Indianization," is 
perhaps better understood as one of localization or "Indonesianization" 
of multiple South Asian traditions. It involved much local selection 
and accommodation (there were no Indian colonizations), and it 
undoubtedly began many centuries before its first fruits are clearly vis- 
ible through the archaeological record. Early Indonesia did not become 
a mini-India. Artistic and religious borrowings were never exact repli- 
cations, and many key Indie concepts, such as those of caste and the 
subordinate social position of women were not accepted. Selected 
ideas filled particular needs or appealed to particular sensibilities, yet 
at the same time they were anything but superficial; the remnants of 
their further elaboration are still very much in evidence today. 

Early Hegemonies 

The Earliest Historical Records 

Although some Indonesian peoples probably began writing on perish- 
able materials at an earlier date, the first stone inscriptions (in Sanskrit 



7 



Indonesia: A Country Study 

using an early Pallava script from southern India) date from the end of 
the fourth century AD (in the eastern Kalimantan locale of Kutai) and 
from the early or mid-fifth century AD (in the western Java polity 
known as Taruma). These inscriptions offer a glimpse of leaders newly 
envisioning themselves not as mere chiefs (datu) but as kings or over- 
lords {raja, maharaja), taking Indie names and employing first Brah- 
manical Hindu, then Buddhist, concepts and rituals to invent new 
traditions justifying their rule over newly conceived social and political 
hierarchies. In addition, Chinese records from about the same time pro- 
vide scattered, although not always reliable, information about a number 
of other "kingdoms" on Sumatra, Java, southwestern Kalimantan, and 
southern Sulawesi, which, in the expanding trade opportunities of the 
early fifth century, had begun to compete with each other for advantage, 
but we know little else about them. Historians have commonly under- 
stood these very limited data to indicate the beginnings of the formation 
of "states," and later "empires" in the archipelago, but use of such terms 
is problematic. We understand that small and loosely organized commu- 
nities consolidated and expanded their reach, some a great deal more 
successfully than others, but even in the best-known cases we do not 
have sufficient specific knowledge of how these entities actually worked 
to compare them confidently with, for example, the states and empires of 
the Mediterranean region during the same period or earlier. More gener- 
alized terms, such as "polities" or "hegemonies," are suggestive of social 
and political models that are more applicable. 

Srivijaya and Mataram 

Srivijaya 

Two great hegemonies dominate the period from about the mid- 
sixth to eleventh centuries. The first is known as Srivijaya, a Bud- 
dhist trading kingship centered on the region of today's city of 
Palembang, on the Musi River in present-day Sumatera Selatan 
Province. At its zenith in the ninth and tenth centuries, Srivijaya 
extended its commercial sway from approximately the southern half 
of Sumatra and the Strait of Malacca to western Java and southern 
Kalimantan, and its influence as far away as locations on the Malay 
Peninsula, present-day southern Thailand, eastern Kalimantan, and 
southern Sulawesi (see fig. 2). It probably arose out of policies of 
war and alliance applied, perhaps rather suddenly, by one local entity 
to a number of trading partners and competitors. The process is 
thought to have coincided with newly important direct sea trade with 
China in the sixth century, and by the second half of the seventh cen- 
tury Srivijaya had become a wealthy and culturally important Asian 



8 



Historical Setting 



power. The Chinese pilgrim Yijing (635-713), who briefly visited 
Srivijaya in 671 and 687 and then lived there from 687 to 695, rec- 
ommended it as a world-class center of Buddhist studies. Inscrip- 
tions from the 680s, written in Pallava script and the indigenous Old 
Malay language (forerunner of contemporary Bahasa Indonesia — 
see Glossary), identified the realm and its ruler by name and 
demanded the loyalty of allies by pronouncing elaborate threats and 
curses. 

Srivijaya's preeminence depended in part on exercising a degree 
of control over the burgeoning commerce moving through the Strait 
of Malacca. This it accomplished by mobilizing the policing capabil- 
ities of small communities of seafaring orang laut (Malay for sea 
people), providing facilities and protection in exchange for reason- 
able tax rates on maritime traders, and maintaining favorable rela- 
tions with inland peoples who were the source of food and many of 
the trade goods on which commerce of the day was built. But Srivi- 
jaya also promoted itself as a commanding cultural center in which 
ideas from all over Buddhist Asia circulated and were redistributed 
as far as away Vietnam, Tibet, and Japan. 

Mataram 

The second great hegemony, known as Mataram, arose as Srivi- 
jaya began to flourish in the early eighth century, in south-central 
Java on the Kedu Plain and southern slopes of Mount Merapi 
(Gunung Merapi). Mataram's early formation is obscure and compli- 
cated by the rivalry of two interrelated lines of aspiring paramount 
rulers, one supporting Shivaist Hinduism (the Sanjaya) and the other 
supporting Mahayana Buddhism (the Sailendra, who had commer- 
cial and family connections with Srivijaya). At some point between 
824 and 856, these lines were joined by marriage, probably as part of 
a process by which the leaders of local communities (rakai or 
rabyan) were incorporated into larger hierarchies with rulers, pal- 
aces, and court structures. In this process, the construction of elabo- 
rately carved stone structures (candi) connecting local powers with 
Buddhist or Hindu worldviews played an important role. The best 
known and most impressive of these are the Borobudur, the largest 
Buddhist edifice in the ancient world (constructed between about 
770 and 820 and located northwest of present-day Yogyakarta) and 
the magnificent complex of Hindu structures at Prambanan, located 
east of Yogyakarta and completed a quarter-century later. These and 
hundreds of other monuments built over a comparatively short 
stretch of time in the eighth and ninth centuries suggest that Javanese 
and Indie (Buddhist and Hindu) ideas about power and spirituality 



9 



Indonesia: A Country Study 




150 300 Miles 



Source: Based on information from Jan M. Pluvier, Historical Atlas of South-East Asia (New 
York, 1995), Map 5; and Robert B. Cribb, Historical Atlas of Indonesia (Honolulu, 
2000), Map 3.5. 

Figure 2. Sumatra and Java from the Seventh Century to the Eleventh 
Century 

both competed and intermingled in a dynamic political and religious 
atmosphere. 

Scholars have generally identified a highly productive irrigated 
rice agriculture as the principal source of Mataram's power, seeing it 
as a kind of inland, inward-looking antithesis to an outward-oriented, 
maritime Srivijaya, but such a distinction is overdrawn. Central Java 

10 



Historical Setting 



was linked from a very early date to a larger world of commerce and 
culture, through connections with ports not far away on Java's north 
coast. Like Srivijaya, Chinese, Indian, and other students of Buddhist 
and Hindu thought visited Mataram, and Javanese ships traded and 
made war against competitors in the archipelago (including Srivijaya) 
and as far away as present-day Cambodia, Vietnam, and probably the 
Philippines. Mataram was certainly not isolated from the wider 
world, and in some respects its commercial life may have been more 
sophisticated than that of its Sumatran contemporary, as it made com- 
mon use of gold and silver monetary units by the mid-ninth century, 
some 200 years earlier than Srivijaya. Politically, the two hegemonies 
were probably more alike than different. The rulers of both saw them- 
selves and their courts {kedatuan, keratuan, or kratori) as central to a 
land or realm (bhumi), which, in turn, formed the core of a larger, 
borderless, but concentric and hierarchically organized arrangement 
of authority. In this greater mandala, an Indic-influenced representa- 
tion of a sort of idealized, "galactic" order, a ruler emerged from con- 
stellations of local powers and ruled by virtue of neither inheritance 
nor divine descent, but rather through a combination of charisma 
(semangat), strategic family relationships, calculated manipulation of 
order and disorder, and the invocation of spiritual ideas and supernat- 
ural forces. The exercise of power was never absolute, and would-be 
rulers and (if they were to command loyalty) their supporters had to 
take seriously both the distribution of benefits (rather than merely the 
application of force or fear) and the provision of an "exemplary cen- 
ter" enhancing cultural and intellectual life. In Mataram, overlords 
and their courts do not, for example, appear to have controlled either 
irrigation systems or the system of weekly markets, which remained 
the purview of those who dominated local regions (watak) and their 
populations. This sort of political arrangement was at once fragile and 
remarkably supple, depending on the ruler and a host of surrounding 
circumstances. 

Very little is known about social realities in Srivijaya and Mataram, 
and most of what is written is based on conjecture. With the exception 
of the religious structures on Java, these societies were constructed of 
perishable materials that have not survived the centuries of destruc- 
tive climate and insects. There are no remains of either palaces or 
ordinary houses, for example, and we must rely on rare finds of jew- 
elry and other fine metalworking (such as the famous Wonosobo 
hoard, found near Prambanan in 1991), and on the stone reliefs on the 
Borobudur and a handful of other structures, to attempt to guess what 
these societies may have been like. (The vast majority of these 
remains are Javanese.) A striking characteristic of both Srivijaya and 
Mataram in this period is that neither — and none of their smaller 



11 



Indonesia: A Country Study 

rivals — appear to have developed settlements recognizable as urban 
from either Western or Asian traditions. On the whole, despite evi- 
dence of socioeconomic well-being and cultural sophistication, insti- 
tutionally Srivijaya and Mataram remained essentially webs of 
clanship and patronage, chieftainships carried to their highest and 
most expansive level. 

The Rise and Fall of Majapahit 

Successor Kingdoms of Java 

During the first decades of the tenth century, Java's center of 
political gravity shifted decisively from the island's south-central 
portion to the lower valley and delta regions of eastern Java's Bran- 
tas River. The move reflected the Sanjaya line's long-term interest in 
eastward expansion, a reaction to increasingly frequent volcanic 
activity in central Java between the 880s and 920s, and economic 
rivalry with Srivijaya. Eastern Java was a rich rice-growing region 
and was also closer to the source of Malukan spices, which had 
become trade items of growing importance. By the early eleventh 
century, Srivijaya had been weakened by decades of warfare with 
Java and a devastating defeat in 1025 at the hands of the Cola, a 
Tamil (south Indian) maritime power. As Srivijaya's hegemony 
ebbed, a tide of Javanese paramountcy rose on the strength of a 
series of eastern Java kingdoms beginning with that of Airlangga (r. 
1010^2), with its kraton at Kahuripan, not far from present-day 
Surabaya, Jawa Timur Province. A number of smaller realms fol- 
lowed, the best-known of which are Kediri (mid-eleventh to early 
thirteenth centuries) and Singhasari (thirteenth century), with their 
centers on the upper reaches of the Brantas River, on the west and 
east of the slopes of Mount Kawi (Gunung Kawi), respectively. 

In this region, continued population growth, political and military 
rivalries, and economic expansion produced important changes in 
Javanese society. Taken together, these changes laid the groundwork 
for what has often been identified as Java's — and Indonesia's — 
"golden age" in the fourteenth century. In Kediri, for example, there 
developed a multilayered bureaucracy and a professional army. The 
ruler extended control over transportation and irrigation and culti- 
vated the arts in order to enhance his own reputation and that of the 
court as a brilliant and unifying cultural hub. The Old Javanese liter- 
ary tradition of the kakawin (long narrative poem) rapidly devel- 
oped, moving away from the Sanskrit models of the previous era and 
producing many key works in the classical canon. Kediri 's military 
and economic influence spread to parts of Kalimantan and Sulawesi. 



12 



Buddhist stupas on upper terrace of Borobudur, built ca. AD 800 
Dieng Hindu temple complex, seventh and eighth centuries AD, 

Jawa Tengah Province 
Courtesy Jennifer Foley 



13 



Indonesia: A Country Study 

In Singhasari, which defeated Kediri in 1222, there arose an aggres- 
sive system of state control, moving in new ways to incorporate 
local lords' rights and lands under royal control and fostering the 
growth of mystical Hindu-Buddhist state cults devoted to the powers 
of the ruler, who came to be accorded divine status. 

Founding and Growth of Majapahit, 1268-1389 

The greatest and most controversial of these kings was Kertanagara 
(r. 1268-92), the first Javanese ruler to be accorded the title of dewa- 
prabu (literally, god-king), largely by force or threat, Kertanagara 
brought most of eastern Java under his control and then carried his 
military campaigns overseas, notably to Srivijaya's successor, Melayu 
(then also known as Jambi), with a huge naval expedition in 1275, to 
Bali in 1282, and to areas in western Java, Madura, and the Malay 
Peninsula. These imperial ambitions proved difficult and expensive, 
however: the realm was perennially troubled by dissent at court and 
rebellion both at home and in the subjugated territories. Much farther 
afield, Kertanagara had provoked the new Mongol rulers of Yuan 
Dynasty (1279-1368) China to attempt to check his expansion, which 
they considered a threat to the region. But before their fleet of alleg- 
edly 1,000 ships and 100,000 men could land on Java, Kertanagara 
had been assassinated by a vengeful descendent of the Kediri kings, 
and in the convoluted events that followed, Kertanagara's son-in-law, 
Raden Wijaya, succeeded in defeating both his father-in-law's princi- 
pal rival and the Mongol forces. In 1294 Wijaya ascended the throne 
as Kertarajasa, ruler of the new kingdom of Majapahit. 

Majapahit is generally regarded as having been the largest pre- 
modern state in the archipelago, and perhaps the most extensive in all 
of Southeast Asia. At its zenith under the fourth ruler, Hayam Wuruk 
(known posthumously as Rajasanagara, r. 1350-89), and his chief 
minister, the former military officer Gajah Mada (in office 1331-64), 
Majapahit 's authority appears to have extended over 20 eastern Java 
polities as direct royal domain; tributaries extending beyond those 
claimed by Singhasari on Java, Bali, Sumatra, Kalimantan, and the 
Malay Peninsula; and trading partners or allies in Maluku and 
Sulawesi, as well as present-day Thailand, Cambodia, Vietnam, and 
China. Majapahit's power was built in part on military might, which 
Gajah Mada used, for example, in campaigns against Melayu in 1340 
and Bali in 1343. Its reach by force was limited, as in the failed cam- 
paign in 1357 against Sunda in western Java, however, making the 
kingdom's economic and cultural vigor perhaps more important fac- 
tors. Majapahit's ships carried bulk goods, spices, and other exotic 
commodities throughout the region (cargoes of rice from eastern Java 



14 



Historical Setting 



significantly altered the diet of Maluku at this time), spread the use of 
Malay (not Javanese) as a lingua franca, and brought news of the 
kingdom's urban center at Trowulan, which covered approximately 
100 square kilometers and offered its inhabitants a remarkably high 
standard of living. Majapahit's writers continued the developments in 
literature and wayang (see Glossary) begun in the Kediri period. The 
best-known work today is Mpu Prapanca's Desawarnana, often 
referred to as Nagarakertagama, composed in 1365, which provides 
us with an unusually detailed view of daily life in the kingdom's cen- 
tral provinces. Many other classic works also date from this period, 
including the famous Panji tales, popular romances based on the his- 
tory of eastern Java that were loved and borrowed by storytellers as 
far away as Thailand and Cambodia. Many of Majapahit's administra- 
tive practices and laws governing trade were admired and later imi- 
tated elsewhere, even by fledgling powers seeking independence from 
Javanese imperial control. 

The image of Majapahit as a glorious empire united under a pow- 
erful ruler has captured the imagination of many Indonesian nation- 
alists since the 1920s. The modern national motto Bhinneka Tunggal 
Ika (roughly, "Unity in Diversity") was drawn from Mpu Tantular's 
poem "Sutasoma," written during Hayam Wuruk's reign; indepen- 
dent Indonesia's first university took Gajah Mada's name, and the 
contemporary nation's communication satellites are named Palapa, 
after the oath of abstinence Gajah Mada is said to have taken in order 
to achieve unity throughout the archipelago (nusantara). Construc- 
tion of a "Majapahit Park" (Taman Majapahit) on the Trowulan site 
began in 2008, with the purpose of raising pride in the nation's past. 
(Some Indonesians interpret things rather differently and see the 
park as an unwelcome reminder of Javanese dominance over the rest 
of the archipelago, historically as well as in more recent times.) 

Majapahit did not unify the archipelago in any modern sense, how- 
ever, and its hegemony proved in practice to be fragile and short- 
lived. Beginning shortly after Hayam Wuruk's death, an agricultural 
crisis; civil wars of succession; the appearance of strong trading 
rivals, such as Pasai (in northern Sumatra) and Melaka (on the Malay 
Peninsula); and restive vassal rulers eager for independence all chal- 
lenged the political-economic order from which Majapahit had drawn 
much of its legitimacy. Internally, the ideological order also began to 
falter as courtiers and others among the elite, perhaps following pop- 
ular trends, abandoned Hindu-Buddhist cults centered on a supreme 
kingship in favor of ancestral cults and practices focused on salvation 
of the soul. In addition, new and often intertwined external forces 
also brought significant changes, some of which may have contrib- 
uted to the dissolution of Majapahit's paramountcy. 



15 



Indonesia: A Country Study 

Outside Influences 

China 

One of these external forces was the growing influence of China. 
After the Mongol incursions, the early Majapahitan state did not 
have official relations with China for a generation, but it did adopt 
Chinese copper and lead coins (pisis or picis) as official currency, 
which rapidly replaced local gold and silver coinage and played a 
role in the expansion of both internal and external trade. By the sec- 
ond half of the fourteenth century, Majapahit's growing appetite for 
Chinese luxury goods such as silk and ceramics, and China's 
demand for such items as pepper, nutmeg, cloves, and aromatic 
woods, fueled a burgeoning trade. China also became politically 
involved in Majapahit's relations with restless vassal powers 
(Palembang in 1377) and, before long, even internal disputes (the 
Paregreg War, 1401-5). At the time of the celebrated state-sponsored 
voyages of Chinese Grand Eunuch Zheng He between 1405 and 
1433, there were large communities of Chinese traders in major trad- 
ing ports on Java and Sumatra; their leaders, some appointed by the 
Ming Dynasty (1368-1644) court, often married into the local popu- 
lation and came to play key roles in its affairs. 

Islam 

Another external force of great importance was Islam, which had 
been known in the archipelago since the eighth century but does not 
appear to have begun to take hold until the beginning of the thirteenth 
century at the earliest. The first Indonesian Islamic ruler in the archi- 
pelago for whom we now have clear evidence was Sultan Sulaiman 
of Lamreh (northern Sumatra), who died in 1211; several other 
Sumatran kings, probably influenced by traders and intellectuals 
arriving from Gujarat and elsewhere in the Indian Ocean, became 
Muslims later in the thirteenth century. Javanese do not appear to 
have begun conversion until well into the fifteenth century, despite 
several centuries' presence there of foreign Muslims. Much of this 
story may not yet be clear to historians, however, for graves at 
Trowulan and Tralaya near the eastern Java heart of Hindu-Buddhist 
Majapahit strongly suggest that some members of that state's elite, 
perhaps even of the court, had converted to Islam as early as 1368, a 
time when Majapahit and its state orthodoxies were still very much in 
the ascendent. The small trading port states on the Pasisir — Java's 
north coast — many of which later broke away from Majapahit's con- 
trol, do not appear to have begun to convert to Islam until at least the 
mid-fifteenth century. This probably developed from the influence of 



16 



Engraving from Franqois Valentyn, Oud en nieuw Oost-Indien 
(Old and New East Indies), Dordrecht, J. Van Braam, 1724-26, 
showing the volcano and harbor at Ternate in the Maluku Islands, 
with an inset outline view of the Dutch fort 
Courtesy Library of Congress Prints and Photographs Division, 
LC-USZ262-64526, digital ID cph 3M2115 

Chinese, Cham, and Chinese-Javanese Muslim merchants and later as 
a result of the efforts of the so-called Nine Saints (wali songo), some 
of whom were probably Chinese- Javanese and others connected with 
Indian and Persian Islam. The conversion of the eastern archipelago 
began with the king of Ternate in 1460, but that region was not 
widely Islamized until the sixteenth and seventeenth centuries. 

The spread of Islam in the archipelago is not well understood his- 
torically, and, especially regarding this early period, scholars con- 
tinue to disagree on many fundamental points, such as the precise 
sources and nature of Muslim influence and the attractions the new 
religion held for those who eventually adopted it. It is not clear, for 
example, whether individuals — rulers, elites, or commoners — con- 
verted for essentially practical considerations (such as the often very 
real economic and political advantages of joining the ummah, or 



17 



Indonesia: A Country Study 

community of believers), because of alienation from existing social 
and political values (in the Hindu-Buddhist kingdoms, for example), 
or out of an intrinsic interest in the new spiritual and cultural ideas 
Islam brought with it. Nor is it always obvious why some conver- 
sions appear to have been peaceful and others coercive and even vio- 
lent, or why some indigenous histories emphasize "miraculous" or 
magical elements in conversions and others do not. Whatever the 
case, Islamization was not an event, or even a series of events, but 
rather a long, variegated, and evolutionary process best understood 
in terms of local, rather than universal, patterns. 

Portugal 

A third external force came into play with the arrival of the Portu- 
guese in the archipelago. They reached the rich and expanding 
Melaka, on the Malay Peninsula, in 1509 and sought trading rights 
there. Some in Melaka's cosmopolitan trading community wanted to 
accept them (perhaps as a counterweight against Sultan Mahmud's 
controversial imperial policies), but others did not, heightening exist- 
ing political tensions. When the Portuguese returned in 1511 com- 
manded by the more demanding Alfonso de Albuquerque, they 
defeated Melaka militarily, soon establishing themselves in the trad- 
ing ports of Banten (western Java) and Ternate (Maluku), and con- 
tacting the much reduced Majapahit kingdom at Kediri in eastern 
Java. These events do not, as is sometimes suggested, mark the begin- 
ning of Western colonial rule, or even European primacy, in Indone- 
sia; that lay far in the future. Rather, the "Western intrusion" was at 
this stage merely one dynamic bound up, in often unpredictable ways, 
with many others. Thus, the final days of Majapahit, weakened by 
internal division, were determined by Trenggana, the half-Chinese 
Muslim ruler of its former vassal port Demak, who in 1527 con- 
quered Kediri for reasons that had as much to do with economic and 
political rivalry (with Banten, the Portuguese, and Majapahit's rem- 
nants) as they did with religious struggle (with both Christianity and 
Hindu-Buddhist ideology). 

The Early Modern Era 

Commercial Developments 

The period between the mid-fifteenth century and the end of the 
eighteenth century was a time of turbulence and profound change for 
the archipelago. Java lost much of its commanding position as new 
states, some great and some small, also raced to acquire wealth and 
exercise power. Urban populations grew rapidly, and with them the 



18 



Historical Setting 



influence of expanding commercial elites. New technologies, for 
example in weaponry and ship design, changed the face of trade. 
And Islam extended its reach at the same time as a wide variety of 
influences diversified and secularized culture. It was also a time in 
which Europeans began to play a direct role in the archipelago's 
affairs, although they did not rule it, and Chinese merchants and 
laborers became more important. All of this took place in the context 
of a commercial boom that greatly expanded prosperity but also 
greatly heightened competition and exposed Indonesia directly to the 
swift and often dangerous currents of what might justifiably be 
called the "first globalization" (see fig. 3). 

This early modern age of commerce was initially fueled by the 
buying and selling of Indonesian spices, the production of which was 
limited and the sources often remote. Nutmeg (and mace) come from 
the nut of the tree Myristica fragrans, which, until the late eighteenth 
century, grew almost exclusively on six tiny islands in the Banda 
Archipelago, some 300 kilometers west of the Papua coast. Cloves 
are the dried flower buds of the tree Syzygium aromaticum, the culti- 
vation of which until the mid-seventeenth century was largely lim- 
ited to a handful of small islands off the west coast of Halmahera in 
the Maluku Islands. These spices had long been distributed in mod- 
est quantities via the trade networks of the archipelago. After about 
1450, however, demand and the ability to pay for them climbed rap- 
idly in both China and Europe. In the century between the 1390s and 
the 1490s, for example, European imports of cloves rose nearly 
1,000 percent, and of nutmeg nearly 2,000 percent, and continued to 
rise for the next 120 years. Another product, black pepper (Piper 
nigrum), was grown more easily and widely (on Java, Sumatra, and 
Kalimantan), but it too became an object of steeply rising worldwide 
demand. These changing global market conditions lay at the bottom 
of fundamental developments, not only in systems of supply and dis- 
tribution but in virtually all aspects of life in the archipelago. 

Westerners and Indigenous Powers 

Until the challenge of direct traders from Europe (first the Portu- 
guese and Spanish at the beginning of the sixteenth century, then the 
Dutch, English, and others at the end of it) and renewed interest from 
the Chinese (after the Ming government relaxed prohibitions on pri- 
vate overseas trade in the mid-sixteenth century), Indonesians held 
virtually exclusive control of the spice trade, and decisive power in 
the extensive exchange of luxury and bulk goods that accompanied 
it. Over a period of about 250 years, however, they gradually lost 
their commercial primacy and, in some cases, much of their political 



19 



Indonesia: A Country Study 




20 



Historical Setting 



independence. This crucial process was far too complex to be under- 
stood simply as a struggle between East and West, or Christianity 
and Islam, or "modern" and "traditional" technology. Europeans not 
only warred vigorously among themselves, but they routinely allied 
themselves with local powers, many of them Muslim, and became 
participants in local rivalries; they also frequently found that their 
weaponry did not give them obvious superiority over indigenous 
powers, who purchased both light and heavy firearms and some- 
times, as in Java well into the eighteenth century, were able to manu- 
facture serviceable copies of European models. Europeans found 
their position fluctuated as a result of a multitude of factors, some of 
them well beyond their control. 

Some of these complexities can be glimpsed in a brief history of 
Ternate, Maluku, in the sixteenth and early seventeenth centuries. In 
1512 seven Portuguese arrived in Ternate as the guests of Sultan 
Abu Lais (r. 7-1522), having been rescued by fishermen from a ship- 
wreck of their locally built vessel (their original ship had become too 
unreliable to continue in service) loaded with spices purchased in 
Banda. The sultan sought an alliance with the Portuguese, of whom 
he had already heard, and was eager to exchange cloves for assis- 
tance against the rival sultanate of Tidore. When Spanish ships 
arrived in Maluku in 1521, Sultan Mansur of Tidore sealed a similar 
agreement with them, to which the Portuguese soon responded by 
building a large stone fortress on Ternate. This act touched off 
decades of warfare among Europeans and their local allies, in which 
political control, economic ascendancy, and religious identity all 
were contested. But it also brought change in Ternate itself, for the 
ruler there became essentially a prisoner of the Portuguese, whose 
increasingly arbitrary and oppressive interference in local affairs, 
including spice production and harvesting, eventually turned their 
former allies against them. Under the leadership of Sultan Babullah 
(r. 1570-83), Islam became a powerful tool with which to create alli- 
ances and gather widespread opposition to the Portuguese. After a 
siege in 1575 against the Ternate fort, he ousted the Portuguese 
forces. Babullah allowed a limited contingent of Portuguese mer- 
chants to continue trading in Ternate, but the fort became the royal 
residence, and the sultanate rapidly expanded its reach to key trading 
ports as far away as northern and southern Sulawesi until the arrival 
of the Dutch touched off new and even more complex struggles. 

Elsewhere in the archipelago over the course of the seventeenth 
century, indigenous and outside powers engaged in a multifaceted 
struggle for control of maritime trade. Rapidly rising profits from 
this trade fueled the growth of ambitious states, the most important 
of which were Aceh (northern Sumatra), Banten (western Java), 



21 



Indonesia: A Country Study 



Makassar (southern Sulawesi), and Mataram (central and eastern 
Java). The most important outside power was the Dutch-run United 
East Indies Company (VOC; for this and other acronyms, see table 
A). Each of the indigenous states experienced a slightly different tra- 
jectory during this period, but the essential contest was between a 
pattern of heavily state-controlled trade on the one hand and, on the 
other, a still tentatively oligarchical pattern, in which the so-called 
orang kaya or merchant elite, and often allied religious and tradi- 
tional elites, played significant political and economic roles. 

The best-known example is Aceh, which arose in the middle of 
the sixteenth century, partly as an effort to control dissension among 
northern Sumatran and Malay polities and partly to control the 
Malay trade, which had dispersed after 1511. (Although Aceh's rul- 
ers were often serious about promoting Islam, their major military 
efforts were over commercial rather than religious affairs, and were 
directed against Muslim as well as Christian rivals.) Aceh reached its 
apogee under Sultan Iskandar Muda (r. 1607-36). He pursued an 
aggressive military policy against neighboring powers, including 
Portuguese Melaka; he presided over a centralized and increasingly 
authoritarian state; he exercised arbitrary power, including attempt- 
ing to establish royal monopolies, over the trading activities and 
even the private property of the orang kaya. He invested in huge, 
heavily armed seagoing ships — one, called Terror of the Universe, 
was more than 90 meters long and carried more than 700 men — of 
new design to compete with European and Chinese vessels. The sul- 
tan also practiced an assertive foreign policy, playing European and 
Asian powers against each other. 

The ruthlessness of Iskandar Muda's regime made many enemies, 
however, and nearly caused a civil war. Its economic gains, rather 
than bringing about a permanent transformation of the political and 
economic structure of Aceh, proved ephemeral. The orang kaya 
reasserted themselves and sought ways to restrict royal power. Until 
the end of the seventeenth century, for example, they successfully 
sponsored a succession of female rulers, perhaps because they con- 
sidered women to be either more moderate or more easily manipu- 
lated than men. But in the eighteenth and nineteenth centuries, both 
their influence and that of the court declined as that of hereditary dis- 
trict chiefs (uleebalang) and Muslim leaders rose. The Acehnese 
state thus lost its imperial authority and much of its political coher- 
ence. Nevertheless — and unlike most of its contemporary regional 
states — Aceh remained an important local power and continued to 
be an economic force to be reckoned with, for example producing 
more than half the world's pepper supply as late as about 1820. Aceh 
did not hesitate to ally itself with Dutch forces in an attack on Portu- 

22 



Historical Setting 



guese Melaka in 1641, but in subsequent years it alone among the 
great nascent states of the early modern archipelago managed to 
avoid entanglement with the VOC, retaining its independence until 
the late nineteenth century. 

The Role of the Dutch United East Indies Company, 
1602-19 

A common historical perspective on the seventeenth and eigh- 
teenth centuries is to portray the VOC as a uniquely powerful military 
and economic juggernaut that steadily and deliberately constructed 
the empire that came to be known as the Netherlands East Indies. In 
the twentieth century, such a view was frequently shared by Dutch 
colonial officials and Indonesian nationalists, who spoke of "350 
years of Dutch rule" in the archipelago. The truth, however, was more 
modest. The VOC was neither the "first (modern) multinational cor- 
poration," as has sometimes been claimed, nor the instrument of a 
state policy of colonial expansion. It was founded in the Netherlands 
in 1602 as an effort to manage the competition and risk of the growing 
number of Dutch expeditions to the Indonesian archipelago (10 com- 
panies, 10 voyages, and 65 ships between 1595 and 1601), and to 
compete with the East India Company, formed by the English two 
years earlier, for control of the Asian trade. The VOC's initial charter 
established its sole right among Dutch enterprises to do business in 
Asia and gave it exceptional powers, such as those of keeping an 
army and using military force, making treaties with local rulers, build- 
ing fortifications, and issuing coinage. In addition, it called for little 
government oversight and did not require the new company to pay 
dividends to investors at the end of each voyage (as had been the prac- 
tice), allowing it to amass large sums of money over longer periods of 
time. The purpose of this state-supported enterprise was primarily to 
make a profit. At home the directors, known as the Heeren XVII 
(Seventeen Gentlemen), recognized that fighting wars, establishing 
colonies (rather than simple trading posts and fortifications), and 
becoming involved in local disputes diminished profits, and they gen- 
erally warned against such activities. 

Far away in the archipelago, VOC representatives, appointed after 
1610 as governors general, tended to see the warring and political 
involvement as necessary and pursued them anyway, often vigor- 
ously. Even the more ambitious of their efforts, however, were 
restrained by certain realities. Above all, the VOC was never big 
enough or strong enough to dominate the entire archipelago and its 
people, and indeed the company found it impossible to enforce its 
will in local affairs without Indonesian allies, who frequently exacted 



23 



Indonesia: A Country Study 

a high price for their assistance and whose loyalty could never be 
taken for granted. It was also the case that even when it had its way — 
for example, by gaining control of specific trading ports or routes, or 
of the main areas in which particular spices were produced — inter- 
ventions by the VOC often had unintended short- and long-term con- 
sequences that it could do little to control. Finally, of course, the 
VOC's fortunes were subject to the vagaries of a trading system that 
stretched far beyond the archipelago, including the rise and fall in 
world demand for spices and, later, for other products on which it 
came to depend, such as coffee. In the course of nearly two centuries, 
the company failed to control the spice trade and establish the stable 
conditions necessary for mercantile growth, and came to rule over 
only minute patches of territory, except for small areas in Maluku in 
the seventeenth century and Java in the eighteenth. 

Nevertheless, the VOC had a shaping influence in the archipelago. 
In what today is eastern Indonesia, the company — with, it is important 
to reiterate, the help of indigenous allies — between 1610 and 1680 
fundamentally altered the terms of the traditional spice trade by forci- 
bly limiting the number of nutmeg and clove trees, ruthlessly control- 
ling the populations that grew and prepared the spices for the market, 
and aggressively using treaties and military means to establish VOC 
hegemony in the trade. One result of these policies, exacerbated by 
the late-seventeenth-century fall in the global demand for spices, was 
an overall decline in regional trade, an economic weakening that 
affected the VOC itself as well as indigenous states, and in many 
areas occasioned a withdrawal from commercial activity. Others were 
the rise of authoritarian rulers dependent on VOC support and unrest 
among groups — traditional leaders, merchants, religious and military 
figures — who opposed one or the other or both. Among the most 
prominent examples are those found in the histories of Ternate in the 
time of Sultan Mandar (r. 1648-75) and the wars against Hitu and 
Hoamoal (1638-56), and of southern Sulawesi in the era of the ambi- 
tious Buginese (Bone) prince Arung Palakka (1634-96) and the wars 
against the Makassarese (Gowa) and others. By the end of the seven- 
teenth century, the glories of the spice trade had faded, and the vitality 
of the large and small states of the post-Majapahit era had been 
sapped; the weight of affairs had again begun to shift west, to Java. 

The Javanese and the VOC, 1619-1749 

In 1619 the VOC had seized Jayakerta (Sunda Kelapa), a small but 
well-protected west Javanese port it had originally contracted from a 
disgruntled vassal of the sultanate of Banten, renaming it Batavia, 
forerunner of today's Jakarta. The resolute Governor General Jan 



24 



Copper coins used in Indonesian colonial trade: A Netherlands East Indies 
(VOC) one duit has on the obverse the crowned arms of Utrecht — where it 
was minted; the reverse shows the VOC monogram and the date 1 790. This 
Chinese one cash reads Qianlong Tongbao (Qianlong [the emperor] 
general treasury) — which dates the coin between 1736 and 1796 — on the 
obverse, and the reverse has the Manchu-language inscription chuanbao for 

the Board of Revenue Mint in Beijing. 

Courtesy Robert L. Worden 

Pieterszoon Coen (in office 1619-23 and 1627-29) had conceived of 
this port as a kind of fulcrum of the company's far-flung Asian enter- 
prise, and he defended it vigorously against both Banten (allied 
briefly with England's East India Company) and, in 1628-29, the 
powerful land and sea forces of the expanding central Javanese state 
that had taken the name of Mataram, after the ninth-century kingdom. 
Mataram's ruler, Sultan Agung (r. 1613^6), was Java's greatest war- 
rior king since Kertanagara nearly four centuries earlier. Using iron 
force and a keen sense of traditional diplomatic opportunities, Sultan 
Agung assembled a realm that consisted of all of Java and Madura 
(including the powerful kingdom of Surabaya) except Banten in the 
far west and the Hindu-Buddhist kingdom of Blambangan in the far 
east. Sukadana and Banjarmasin on Kalimantan also fell under his 



25 



Indonesia: A Country Study 

sway. He was not, however, able to dislodge the VOC, and after the 
failed campaign of 1628-29 he appears to have accepted the Dutch 
presence as a minor irritant. Contemporaneous Javanese historical 
works treated the company more as a potential ally than as a serious 
threat, a view that persisted among many in court circles for another 
century or more. And, indeed, at the time the VOC was neither inter- 
ested in nor capable of tackling the full force of Mataram, which 
despite the destruction and political tensions wrought by nearly 40 
years of expansion remained, a formidable military power. The com- 
pany saw itself as a maritime power, a rival for the control of produce 
and trade rather than territory, and it sought stable conditions for its 
activities rather than upheaval (see fig. 4). 

Conditions began to change, however, during the disastrous reign 
of Sultan Agung's son, Amangkurat I (r. 1646-77), who lacked his 
father's talents but sought to further strengthen the realm by central- 
izing authority, monopolizing control of resources, and destroying 
all real or imagined opposition. His misguided efforts to control 
trade revenues by twice closing the ports of the Pasisir, and even 
destroying Javanese trading vessels and forbidding Javanese travel 
overseas, had the opposite effect, in addition to alienating the com- 
mercial community and damaging the wider economy of producers. 
His obsessive fear of opposition led him to kill more than 5,000 
Muslim leaders and their families in a single, well-planned massa- 
cre, and to murder hundreds of court officials and members of the 
aristocracy, including his own family, actions that of course only 
increased the hatred and intrigues aimed at removing him. His atti- 
tude toward the VOC was ambivalent, for, on the one hand, he 
admired its apparent wealth and power and considered it a potential 
ally and protector, yet on the other hand he sought to bend it to his 
will and to extract all he could from its representatives in Batavia. 
Beginning in the early 1670s, rebellions began to rise, the most pow- 
erful of which was led by Raden Trunajaya (ca. 1649-80), a 
Madurese aristocrat conspiring with a disaffected son of Amangku- 
rat I and allied with Makassarese and other forces. Trunajaya's 
armies won a decisive victory in 1676 and looted the capital the fol- 
lowing year. Mataram was disintegrating. 

In the course of this conflict, both sides requested assistance from 
the VOC, which now faced a momentous decision. The company 
sought political stability and a reliable supply of such key products 
as rice and teak, and it determined for the first time in more than a 
half-century that, in order to obtain them, intervention in Mataram's 
internal affairs was necessary. Company officials viewed Javanese 
kingship through a European lens as a relatively absolutist, central- 
ized form of rule that legitimated succession by, if not strict primo- 



26 



Historical Setting 



geniture, then something very close to it. This was a misreading of 
Javanese (and, indeed, other Indonesian) cultural custom, but none- 
theless the VOC gradually came to see itself as the upholder of order 
(tradition) and to justify its actions in terms of favoring continuity 
rather than change. It made its choices accordingly, often with the 
ironic result of creating rather than solving discord and of weakening 
rather than strengthening the sorts of order it hoped to achieve. In 
any case, the VOC decided in 1676 to back the forces of Amangku- 
rat I, who died soon after having fled to VOC-controlled territory on 
the Pasisir, and then to support his rebellious son as successor, a 
project requiring five more years of warfare to complete. The com- 
pany gained treaties promising, among other things, access to the 
products and trading rights it sought, as well as repayment of all its 
military costs. That these treaty obligations proved difficult to fulfill 
did not negate the fact that the VOC had now embarked on a course 
that slowly and expensively intertwined its own fate with that of 
Mataram. The dark legacy of Amangkurat's tyrannical misrule thus 
lay not only in 80 years of turbulence in Javanese life, punctuated by 
three destructive wars of succession, but also in the establishment of 
patterns of Dutch entanglement in indigenous affairs that were to 
outlive the VOC itself. 

Decline of the VOC, 1749-1816 

By the mid-eighteenth century, the VOC and the court of Mataram, 
at the same time rivals and allies, were exhausted by war. The dying 
ruler, Pakubuwana II (r. 1726-49), with his kingdom still threatened 
by rebellion from within and his court deeply divided over the proper 
course for the future, ceded Mataram to the company, perhaps think- 
ing in this way to save it. The treaty was of little importance because 
it could not be enforced and the VOC was incapable of ruling Java, 
but it was followed in 1755 by the Treaty of Giyanti, which imposed a 
different solution. Mataram was to be ruled by two royal courts, one 
at Surakarta (also known as Solo) and one at Yogyakarta, out of 
which the junior courts of Mangkunegaran (1757) and Pakualaman 
(1812), respectively, later evolved by apportioning appanage rights 
among them. This division produced an extended period of peace 
lasting well into the nineteenth century, from which the Javanese pop- 
ulace benefited economically. The courts, particularly that of Yogya- 
karta, made use of their considerable autonomy and grew in 
prosperity and power, while the VOC consolidated its control over the 
Pasisir and pursued its commercial ventures. Although clearly recog- 
nized (and often resented) as the paramount power, the company 
interested itself in the courts' affairs and played a role in choosing 



27 



Indonesia: A Country Study 




Historical Setting 



who reigned but refrained from meddling too deeply. It was a strange 
conquest. 

The peace was in many respects also strange, for rather than set- 
tling Java into a calm "traditional" existence, it provided the setting 
for ongoing social and cultural ferment as Javanese reassessed not 
only their past but also their present. The literary reflections of this 
crisis have been insufficiently studied, but works ascribed to the Sura- 
karta court poets Yasadipura I (1729-1803) and his son Yasadipura II 
(? -1844), for example, suggest that efforts to reexamine and revital- 
ize old histories failed, not least because the ability to read them accu- 
rately had been lost, and that attempts to understand the Java — and, 
we might say, "Javaneseness" — of their own day led frequently to 
searing critiques of their own social hierarchy and customs, as well as 
those of foreigners and Islam. This sort of questioning and restless- 
ness was not necessarily fatal, however, and might under different cir- 
cumstances have permitted a continuation of the equilibrium already 
achieved or even conceivably have led to a kind of Javanese renais- 
sance and a different, more advantageous relationship with the Dutch. 
But changes in the larger world determined otherwise. 

In the early 1780s, the last in a series of wars with the British cost 
the Netherlands, including the VOC and its far-flung interests, 
dearly. Nearly half the company's ships were lost, and much of their 
valuable cargoes; enormous debts accumulated, which, despite state 
loans, could not be repaid. While the company certainly was bur- 
dened with other fiscal and administrative problems, among them a 
high level of corruption among its employees, the British war seems 
to have been the critical factor in its fiscal collapse. In 1796 the VOC 
was placed under the direction of a national committee until the end 
of 1799, when it was liquidated, its debts and possessions absorbed 
by the Dutch government. 

By this time, however, the Napoleonic wars had brought the Neth- 
erlands under French control, and in rapid succession the former 
VOC territories fell under the direction of leaders appointed by 
France — the military officer Herman Willem Daendels from 1808 to 
1811 — and, after Napoleon's defeat, by Britain, which appointed an 
East India Company official, Thomas Stamford Raffles, for the 
period 1811-16. Daendels and Raffles saw themselves as liberal 
reformers, enemies of feudal privilege and practices such as forced 
labor and delivery of produce, proponents of the welfare of the com- 
mon folk, and opponents of corruption and inefficiency. Raffles 
sought to "free" Javanese laborers by instituting a system of land 
rent, in which farmers grew cash crops and sold them in order to pay 
the government for the use of the land. But the sharpest break with 
VOC practice lay in the assumption by the new powers of sovereign 



29 



Indonesia: A Country Study 

rights over the Javanese courts, treating rulers and courtiers not as 
allies but as clear subordinates, and their representatives not as local 
lords but as mere bureaucratic officeholders. Both men interfered 
directly in court affairs. Daendels replaced Yogyakarta's ruler (on 
suspicion of rebellion) and annexed territory by force of arms. Raf- 
fles actually bombarded and looted the Yogyakarta court (for the 
same reason), establishing the Pakualaman from some of its appa- 
nage lands, and exiled an unruly Surakarta prince. These acts, and 
the attitudes behind them, foreshadowed nothing less than a new age 
for the archipelago, an age of Dutch colonial rule. 

Development of European Colonial Rule 

End of the Ancien Regime in Java, 1816-34 

In 1816 the Netherlands regained responsibility for the East 
Indies — actually a welter of mostly coastal territories, some con- 
trolled directly and many others engaged through varying treaties — 
but the way forward was uncertain (see, for example, fig. 5). The 
growth of trade with Sulawesi and the establishment of plantation 
economies, especially those producing sugar (eastern and central 
Java) and coffee (western Java and western Sumatra) had begun to 
loosen customary ties and introduce elites to new sources of both 
riches and indebtedness. In Java, the general population increased 
and grew more prosperous but, on the other hand, fell victim to 
increasing crime, heavier taxation, and exploitation by local Chi- 
nese, especially in their roles of tax farmers, tollkeepers, and leasers 
of plantation lands. The legitimacy of ruling elites was questioned 
more widely. Both traditionalists and Muslims felt their ways of life 
threatened by changes they tended to identify with growing Euro- 
pean influence. A Dutch decision in 1823 to end what it viewed as 
the abusive leasing of land and labor among central Java's aristoc- 
racy alienated many who had begun to adjust to the new circum- 
stances and pushed them to support rebellion. The general 
atmosphere of restlessness in a time of change that few understood 
also became charged with superstition and millennial expectations in 
reaction to crop failures, outbreaks of disease, and, near Yogyakarta, 
a destructive eruption of the Mount Merapi volcano. 

The struggle known as the Java War (1 825-30) was led by a disaf- 
fected prince of the Yogyakarta court, Diponegoro (1785-1855). He 
was a complex figure who opposed rule by both the Dutch and the 
complicit Javanese ruler and aristocracy, and whose rebellion must 
therefore be seen as a Javanese civil war — although not one primar- 
ily concerned with questions of succession, as in the eighteenth cen- 



30 



Historical Setting 



tury — at least as much as an anticolonial one. Despite his modern 
Indonesian status as a national hero, Diponegoro appears to have 
sought merely to have relations with the Dutch return to the form 
they had assumed in late VOC times, and certainly had no concep- 
tion of a broader Indonesian nation. 

Diponegoro was able to attract, for a time, the loyalty of those 
who felt the crumbling of the previous order in different ways and 
had a variety of social and moral expectations. He was seen vari- 
ously as a protector of the general populace, as both a Muslim and a 
traditionalist messianic figure, a Ratu Adil (just king), and as an 
upholder of social hierarchy under a reformed or purified aristoc- 
racy. These alliances proved fragile, however. There were obvious 
internal tensions, for example, disagreements between those who 
had fought for religious reasons (responding to Diponegoro's decla- 
ration of a Muslim holy war, or jihad) and those, especially among 
the court elite, who had done so for essentially secular reasons. The 
difficulty of the war itself, for which the Dutch devised new military 
strategies and which spread destruction on a scale unseen in genera- 
tions, was extreme: about two-thirds of Java was affected, a quarter 
of its cultivated land was laid waste; and approximately 200,000 
Javanese and 15,000 government troops (8,000 of whom were Euro- 
peans) were killed. Backed initially by about half of Yogyakarta's 
ruling elite, by early 1830 Diponegoro had lost most of their support, 
as well as that of both his chief military commander and his most 
influential Muslim patron and his followers. Abandoned by all but a 
few loyal comrades, he attended a peace discussion with the Dutch 
commander of government forces at which he was arrested and sent 
into exile. He died imprisoned in the government fort in Makassar. 

The conclusion of the Java War marked the end of Java's old social 
and political order. The government in Batavia sharply reduced the 
lands under the courts' control, and the fiction of Mataram finally gave 
way to what were now termed merely the vorstenlanden (principalities) 
and seen as comparatively minor vestigial powers. The Javanese elites 
acquiesced, although not without some resentment, in part because 
another war was inconceivable and in part because they calculated that 
acquiescence was necessary if they were to retain anything at all of 
their privileged socioeconomic status. At the same time, the end of the 
war made equally clear that a new era had begun — not only for Java, 
but for the broader archipelago — an era in which the government of the 
Netherlands assumed full sovereignty. It began to oversee its territories 
through the new Ministry of Colonies (established in 1834), and took a 
strikingly different attitude toward indigenous peoples. As J. C. Baud 
(1789-1859), the first governor general of the Netherlands East Indies 
with full executive authority (1834-36), stated succinctly, "We are the 



31 



Indonesia: A Country Study 



Under Dutch direct rule in 1816 
Part of Ternate Sultanate until 1907 



R£%£^ State of Luwu 
l l Claimed by Luwu until 1905 

In treaty relations with Dutch as of 1824 



Region boundaries 

(1905) Date refers to Dutch occupation 
1860 Date refers to direct Dutch control 
• Populated place 



A 




Source: Based on information from Jan M. Pluvier, Historical Atlas of South-East Asia (New 
York, 1995), Map 40. 

Figure 5. Sulawesi in the Nineteenth and Twentieth Centuries 



rulers and they are the ruled." The resulting colonial state did not come 
suddenly into existence, however, but developed in stages, from hybrid 
arrangements of convenience to a modernizing administrative struc- 
ture, over the course of more than a century. 



32 



Historical Setting 



Establishment of the Colonial State 

The Dutch colonial state had its foundation in conquest. Unlike the 
violence used earlier by the VOC, the military expansion of the nine- 
teenth century was deliberately territorial and penetrated far beyond 
the coastal areas. It generally had as its goal fundamental regime 
change and — although in truth this was often beyond Batavia's capa- 
bility — the establishment of control by a centralized authority. Quite 
different from the eighteenth century, too, colonial forces enjoyed a 
degree of technological superiority over most of their adversaries, a 
result of the industrial revolution. And, whereas the VOC had fought 
with an assortment of indigenous allies, now the colonial state fought 
for its own interests, engaging indigenous men as soldiers. The colo- 
nial government's separate fighting force, known as the Royal Nether- 
lands Indies Army (KNIL), was founded only a few weeks before 
Diponegoro's surrender in 1830. Although assigned the task of main- 
taining rust en orde (tranquillity and order) throughout the colonial 
state's territories, the KNIL became best known for its role in the colo- 
nial wars of expansion. Dominated by ethnic Dutch, and later Eurasian, 
officers, in the mid-nineteenth century about two-thirds of KNIL 
troops were Indonesians, predominantly Javanese and Ambonese, and 
the rest "European," a confusing category that included not only white 
Europeans but also a small number of black Africans and others. 

Modern military intrusions began at about the same time as the 
Java War and lasted into the early twentieth century. Their circum- 
stances varied. In some instances, such as that of the Padri Wars 
(1821-37) in Minangkabau in western Sumatra, the military assis- 
tance of the colonial government was sought by indigenous factions, 
in this case members of the aristocracy and some village clan leaders 
beleaguered by Wahhabi-influenced Muslim reformers. The reformers 
were defeated, but the aristocracy and clan leaders eventually surren- 
dered their powers to the colonial state. In other examples, such as 
those of Banjarmasin (southern Kalimantan, 1857-59) and Palem- 
bang (southern Sumatra, 1 823^9), the government imposed and then 
deposed rulers without invitation, but with similar results. The war 
against the great power of Aceh (northern Sumatra, 1873-1903) was 
the most extensive and costly of all these conflicts. The Dutch pursued 
it because of the imperial designs of other Western powers, commer- 
cial and military competition from the Acehnese, and the spread from 
Aceh of anti-Western, anticolonial Muslim movements. For a time, 
Batavia appeared to take up the cause of the uleebalang, or traditional 
and more secular elite, as had been the case in Minangkabau, but this 
was a temporary tactic, and in any case the uleebalang too ended up 
subservient to the colonial state, which finally annexed Aceh outright. 



33 



Indonesia: A Country Study 

Among the last conflicts were those in Bali and Lombok, where 
the intervention of colonial forces after 1840 had been limited, in 
part by fierce Balinese resistance. After the mid- 1880s, however, 
warfare and rebellion in a number of Balinese kingdoms, and Dutch 
interest in controlling the important, ongoing local trade in slaves 
and opium, led the colonial state to apply increasing military pres- 
sure. It conquered Lombok in 1894, and, between 1906 and 1908, 
the last independent Balinese rulers submitted. In the kingdoms of 
Badung, Tabanan, Klungkung, and others, the rajas and their fami- 
lies and followers sacrificed* themselves in dramatic frontal assaults 
on the KNIL guns. These puputan, or ritual suicides, killed hundreds 
of men, women, and children, decimating the aristocracy and obliter- 
ating all meaningful further resistance to the expansion of colonial 
rule in Bali. With smaller campaigns to establish claims of colonial 
sovereignty in Timor and Flores between 1908 and 1910, the Nether- 
lands East Indies reached, at least in outline, its final extent, includ- 
ing far-off territories such as the Kai Islands (in southeastern 
Maluku) and Papua (on the island of New Guinea). 

The Cultivation System 

A colonial state aimed at managing the territories and people 
acquired as a result of these conquests — or "pacifications," as some 
preferred to describe them — emerged gradually and piecemeal. It 
first began to take shape around the time of Diponegoro's defeat, 
with the inauguration in Java of policies that came to be known as 
the Cultivation System (Cultuurstelsel). This was the brainchild of 
Johannes van den Bosch, a military man and social reformer who 
became governor general (1830-34) and later minister of colonies 
(1834-39). He sought to solve the fiscal problems of Batavia and the 
Netherlands, both of which were on the brink of bankruptcy, as well 
as those of a populace devastated by warfare on Java. Van den Bosch 
believed that Java was a rich but underproductive land, primarily 
because Javanese farmers, even when their own prosperity was at 
stake, would not or could not produce beyond a subsistence level 
unless guided, even compelled, to do so. "Force," he wrote, "is 
everywhere the basis of industry ... where it does not exist there is 
neither industry nor civilization." 

Van den Bosch's plan forced Java's farmers either to use existing 
agricultural lands or open new ones in order to cultivate crops for 
export, deliver them to the government at fixed prices, and utilize the 
income to offset or pay the government taxes on their land. The 
crops first targeted were sugar and indigo, but coffee and pepper 
were soon added, followed by newer crops, such as tea, tobacco, and 



34 



Dutch officials home in Surabaya, 1854 
Courtesy Library of Congress Prints and Photographs Division, 
LC-USZ62-105190, digital ID cph 3c05190 

cinnamon. Unlike the system that Raffles had contemplated, van den 
Bosch proposed dealing with whole villages rather than individuals, 
and using government officials and local authorities (who received a 
percentage of revenues their areas generated) to regulate which 
crops would be grown, on which and how much land, with which 
and how much labor, and at what prices. Bringing the produce to the 
world market through the Netherlands became the monopoly of the 
Netherlands Trading Association (NHM), a private company in 
which the Dutch king was a major stockholder. Entrepreneurs in 
general were locked out of the state-run system. This approach, van 
den Bosch argued, would assure production and profits great enough 
not only to subsidize the colonial administration and contribute 
handsomely to the treasury of the Netherlands but also to substan- 
tially improve the well-being of the Javanese. Scholars and politi- 
cians alike have been arguing ever since over what exactly the 
results were. 

There is little doubt that fiscally, and from a government perspec- 
tive, the Cultivation System was an enormous success. Between 1830 
and 1870, Java's exports increased more than tenfold, and profits 
nearly sevenfold; the colonial government regained solvency almost 
immediately and between 1 832 and 1 877 remitted a budgetary surplus 



35 



Indonesia: A Country Study 

(batig slot) totaling 823 million Dutch guilders to the treasury of the 
Netherlands, on average about 18 million guilders annually, about a 
third of the national budget. It is no exaggeration to say that nine- 
teenth-century Dutch prosperity rested very largely upon these funds. 

Whether the Javanese benefited from or were impoverished by the 
Cultivation System, however, is much less clear. Generalization about 
this question is made particularly difficult by the fact that the system 
as actually implemented was not very systematic and varied consider- 
ably according to time, place, and circumstance. In some regions, for 
example, 40 percent of the adult population labored for the system 
and in others, 100 percent; in some areas, less than 4 percent of agri- 
cultural land was used and in others, 15 percent. Abuses of the sys- 
tem's provisions, including official corruption, also varied sharply by 
locale. The principal criticisms were, and continue to be today, moral 
ones. The Cultivation System was portrayed as having been founded 
on greed and as being not only coercive and exploitative but also 
prone to a range of abuses, all of which produced, for the average vil- 
lager, only impoverishment. This view was put forth most memorably 
in the 1860 Dutch novel Max Havelaar by Eduard Douwes Dekker 
(1820-77), an embittered former colonial official who wrote under 
the pseudonym Multatuli ("I have suffered much"). Douwes Dekker 's 
account was widely understood, probably not entirely accurately, as a 
thoroughgoing indictment of colonial rule in general and the Cultiva- 
tion System in particular, which he accused of having created a uni- 
formly desperate, destitute peasantry. This, or something much like it, 
became the received view. Recent studies, however, based on reread- 
ings of old evidence as well as on archival information that became 
available only in the mid-twentieth century, suggest a far more com- 
plex picture. While acknowledging that the burdens of the Cultivation 
System fell on the laboring Javanese populace, they also argue that 
the majority probably saw at least limited economic improvement and 
took advantage of new economic opportunities, although at the cost 
of a more regimented and government-controlled existence, and with 
the added risk of dependency on world markets. This was a form of 
circumscribed change that shaped Java's village world far into the 
future. 

The Cultivation System had not required an elaborate state appa- 
ratus. It was deliberately a form of indirect rule using an existing 
hierarchy of the Javanese priyayi (see Glossary) elite, especially the 
upper ranks of traditional local officeholders known as the pangreh 
praja (rulers of the realm) and village heads. As late as the mid- 
18508, European officials and regional supervisors numbered fewer 
than 300 for an indigenous population of more than 10 million. A 



36 



Rubber plantation workers, Java, between 1900 and 1923 
Courtesy Library of Congress Prints and Photographs Division, Frank and 
Frances Carpenter Collection, LC-USZ62-1 00045, digital ID cph 3c00045 



37 



Indonesia: A Country Study 

small number of freelance European engineers and locally requisi- 
tioned laborers undertook the construction of roads and irrigation 
works needed for the new plantations. This began to change, how- 
ever, as the system grew, underwent reform, and then, especially 
after the Sugar Act and Agrarian Act of 1 870, gradually gave way to 
private enterprise. The responsibilities of the colonial government 
burgeoned, and in order to meet them, it expanded pangreh praja 
ranks by dividing and standardizing their administrative territories 
and tightened control, by rescinding their traditional rights to sym- 
bols of status and access to villagers' labor and services, tying them 
to government salaries and procedures. Alongside the pangreh praja 
now served a growing parallel hierarchy of European officials — 
ostensibly functioning as advisers or "elder brothers" of their native 
counterparts but increasingly directing them — whose reach, by 
1882, extended as far down as the subdistrict level, just above the 
village head. In addition, more specialized government offices came 
into being: a Bureau of Public Works (with its own corps of engi- 
neers and an irrigation division), as well as departments of agricul- 
ture, education, finance, justice, and religion, all with their own 
structures and technical staffs. 

The Ethical Policy 

In 1901 Queen Wilhelmina of the Netherlands announced the gov- 
ernment's acceptance of the idea that it owed a "debt of honor" to the 
East Indies because of the profits generated by the Cultivation System, 
and its intention of henceforth basing its colonial policies on a "moral 
duty" to them. This new direction, commonly referred to by historians 
as the Ethical Policy, called for new and extensive government initia- 
tives to expand public schooling, improve health care, modernize 
infrastructure (communications, transportation, and irrigation), and 
reduce poverty. The administrative system was to be overhauled in 
favor of a more modern, efficient structure. Colonial authorities began 
decentralizing fiscal and administrative responsibilities (in 1903 and 
1922, respectively), forming local and colony- wide semirepresenta- 
tive political bodies (among them the Peoples' Council, or Volksraad, 
in 1918), and ending, or at least modifying, the dualism inherent in the 
interior administrative service with its parallel lines of European and 
indigenous officials. In addition, for the first time, the colonial state 
attempted to simplify and standardize the administrative features of its 
rule in the Outer Islands (see Glossary), using what was being done on 
Java (and Madura and Bali) as a rough template. 

Although Ethicists, as supporters of the policy were called, may 
sometimes have been seen as arguing for a weakening of colonial 



38 



Historical Setting 



rule and lessening of European influence, this was not the case. They 
aimed at modernizing the imperial state, which also meant Europe- 
anizing, or at least Westernizing, it. It is fair to say that in technical 
matters the Ethicists were more successful than with social and polit- 
ical questions: food production generally kept pace with population 
growth, and distribution improved; efforts to combat the plague and 
other diseases were moderately effective; and irrigation and trans- 
portation facilities (roads, railroads, and shipping lines) grew rap- 
idly. The problem of administrative dualism could not be resolved, 
however, largely because European officialdom was unwilling to 
surrender its position. Political decentralization and the introduction 
of some form of representation for Europeans and indigenes edu- 
cated in Europe were limited by, among other things, the central 
government's reluctance to surrender its ultimate control of budget- 
ary and legal affairs. Likewise, legal standardization foundered on 
the increasingly heated debate over whether non-Europeans should 
be subject to Western law or to other legal principles such as those of 
local unwritten custom (adai) or the sharia (see Glossary), Islamic 
law, called syariah in Bahasa Indonesia. 

The Racial Issue 

The unresolved issue of greatest importance was that of racial classi- 
fication, which the modern Dutch historian Cees Fasseur has identified 
as both the "cornerstone and stumbling block" of the colonial state. 
Under the VOC, people were classified mainly on the basis of religion 
rather than race, Christianized indigenes generally falling under the 
same laws as Protestant Europeans. In the early nineteenth century, 
however, "enlightened" ideas began to emphasize — often on "humani- 
tarian" grounds that sought protection of indigenous peoples — a separa- 
tion between native and European rights, and the Cultivation System, 
with its clear distinction between rulers and ruled, emphasized that 
divide. In practice, if not yet in law, non-Europeans were treated very 
differently from Europeans in judicial and penal matters, and in 1 848 
legal and commercial codes appeared that were applicable to Europeans 
only. Statutes of 1 854 made a formal (but not very specific) distinction 
between Europeans and natives {inlanders), at the same time as offering 
them "equal" protection. Everyday understanding and practice, how- 
ever, was that "equal" did not mean "the same," and that, in particular, 
Europeans and Asians occupied separate legal spheres. Almost immedi- 
ately, however, there were difficulties. The category of Asians was fur- 
ther divided into "natives" and "foreign orientals," among whom the 
Chinese, ostensibly for business reasons, in 1885 were determined to 
fall under European commercial law. The category "European" did not 



39 



Indonesia: A Country Study 

distinguish between full-blooded Europeans — the so-called totok 
Dutch — and those of mixed European and indigenous parentage — the 
Eurasians, or so-called Indos. In 1899, for political reasons, the Japanese 
were accorded European public and private legal status, and in 1925 the 
same was done for those whose country of origin adopted Western fam- 
ily laws, such as Turkey and Siam (after 1939, Thailand). "Natives" 
remained a separate, and lower, category. 

One might think that these circumstances would soon have led to 
the abandonment of all racial or national distinctions and a unifica- 
tion of colonial law and policy in general, but instead a fundamental 
dualism — native and European — remained. This outcome is all the 
more remarkable because it was at odds with important realities in 
colonial life. In the early twentieth century, Europeans increasingly 
married across racial categories. In 1905 about 15 percent were in 
interracial marriages, rising to 27.5 percent by 1925. And, although 
by the mid- 1920s the older mix of dress and sensibilities known as 
"Indies" (Indische) culture was rapidly giving way to more modern, 
urbanized, European- and American-influenced forms, numerous 
memoirs of Europeans, Eurasians, Chinese, and Indonesians make it 
clear that, despite obvious racial tensions and divisions, a new sort of 
Dutch- speaking, racially mixed, and culturally modern society was 
coming into being, mostly in the largest cities and mostly among the 
upper and upper-middle economic classes. 

A powerful countercurrent was also developing, however. In part, 
this was the result of the stubborn refusal of the colonial state either 
to surrender the formal dualism on which it had been built, or to face 
squarely the many anomalies created by its insistence on legal classi- 
fication. Especially as the specters of nationalism and communism 
came into focus after 1918, the idea of emancipation for all simply 
could not be accepted, either in the abstract or for practical reasons. 
Other factors included the greater numbers of newcomer, full- 
blooded Europeans, including women, arriving in the colony, most 
of whom had the notion that colonial life there should adjust itself to 
their standards, not the other way around. The resentment that 
resulted among Eurasians and indigenes, already chafing against the 
effects of both formal and informal discrimination, the Great 
Depression of the 1930s, and the approach of World War II (1939— 
45) in different ways deepened existing fears. After 1930, racism 
became more visible in all coiners of colonial society. To all of this 
the colonial government remained strangely cold, taking merely an 
attitude of watchfulness and determination to "keep the peace." 
When, in 1 940, the governor general appointed the Visman Commis- 
sion to determine what the public really thought about issues con- 
nected with the constitutional development of the colony, the 



40 



Historical Setting 



clearest finding was that discrimination was universally considered a 
serious problem, and that all other groups wished to hold legal 
equality with Europeans. The commission's own suggestions for 
solving the problem by replacing racial criteria with education, 
financial, and other measures were unworkable, and in any case time 
had run out. On December 7, 1941, two days after the commission 
submitted its report, Japan attacked the United States naval base at 
Pearl Harbor. 

Modernism and Nationalism in the Colonial Age 

The Rise of Education and Student Associations, 1900- 
1920 

At the dawn of the twentieth century, the young daughter of a Java- 
nese pangreh praja, Raden Ajeng (R. A.) Kartini (1879-1904), 
expressed in letters to Dutch friends her enthusiasm for the "Spirit of 
the Age ... [before which] solid ancient structures tottered," and her 
joy at witnessing the "transition from old to new" that was going on 
around her. Her main concern, however, was how her own people, 
whom she described as "grown-up children," might progress — not 
precisely on a European model, but certainly with Dutch assistance — 
and concluded that the only way forward was through Dutch educa- 
tion. Kartini was only in part echoing ideas close to the hearts of the 
Ethicists who befriended and later lionized her and her efforts to pro- 
mote modern education for women as splendid examples of their 
cause; it is clear that she rebelled against her traditional environment 
early on, and also did not always agree with her Ethicist friends. She 
was not alone. At roughly the same time, young male contemporaries 
from the Javanese privileged classes who attended government 
schools were coming to similar conclusions, and were in a better posi- 
tion to take more public, activist positions. Like Minke, the hero of 
the 1980 novel set in Kartini's day by Pramudya Ananta Tur (1925- 
2006) in his Bumi Manusia (This Earth of Mankind), they were alien- 
ated from their parents' generation, saw no future in aristocratic status 
or careers as pangreh praja, and felt drawn to all that was new, scien- 
tific, and modern. They did not yet have the idea of a nation in mind, 
but they were busy trying to imagine a modern society of their own, 
and how to make it a reality. In the process, they began to coalesce as 
a new priyayi class — a class based on achievement rather than birth, 
devotion to modernity rather than tradition — that would determine the 
course of their country's history for the remainder of the century. 

That was not, of course, exactly what the Ethicists had in mind 
when they promoted Western education. They had hoped to create a 



41 



Indonesia: A Country Study 

broad new priyayi class, which, thanks to a modern Western educa- 
tion, would take a cooperative, associationist path. Such was the goal 
behind the extensive education reforms that, beginning in 1900, over- 
hauled the limited training available for medical personnel, vernacu- 
lar primary school teachers, and prospective pangreh praja. The most 
important institutions to appear were the School for Training Native 
Government Officials (OSVIA) and the School for Training Native 
Doctors (STOVIA), both established in 1900, and the Dutch-Native 
Schools (HIS), established in 1914, which were Dutch-language pri- 
mary schools for the upper classes. There was also a significant 
expansion of vernacular primary village schools {sekolah desa). 

Looking at the colony as a whole, these advances may seem negli- 
gible. As late as 1930, about 10,000 sekolah desa enrolled roughly 
1.6 million students, or 2.8 percent of a population estimated at 60 
million. Dutch-language education enrolled far fewer indigenous 
students: about 85,000 or roughly 0.14 percent of the total popula- 
tion. General literacy was estimated at 7.5 percent and in Dutch, 
about 0.3 percent. The Dutch-language schools with Western-style 
curricula created a small but motivated group, however, who 
emerged with a changed outlook. The schools were located princi- 
pally on Java, where they gathered together students from all over 
the archipelago and gave them a shared experience. More convinced 
than ever of the power of Western education, they also grew dissatis- 
fied. Although Dutch-language schools above the HIS enrolled 
Europeans as well as indigenes, the latter were a comparatively 
small minority, and they often felt the sting of prejudice, both real 
and perceived. Equal in education, indigenous students began to 
chafe under obvious inequalities: legal, economic, and social. They 
also quickly became aware of what a tiny minority they were in their 
own society, and that the demand for Dutch-language education, 
widely seen as key to social and economic advancement, was far 
beyond the colonial government's ability or willingness to provide. 
Rather than generations of grateful and subservient graduates, the 
colonial schools quickly produced a significant number of malcon- 
tents, whose most common message was not that the colonial state 
was modernizing indigenous society too quickly, but precisely the 
opposite. They believed they could, and had the duty to, do better. 

Students from Dutch-language schools founded the first indige- 
nous groups organized along Western-influenced lines and aimed at 
modernization and education. Probably the first person to do this was 
the pangreh praja son, ex- STOVIA student, and pioneer journalist 
Raden Mas Tirtoadisuryo (1880-1918), who in 1906 established the 
Serikat Priyayi (Priyayi Association), aimed at convincing the colo- 
nial authorities to expand educational opportunities for priyayi. The 



42 



Historical Setting 



best-known and officially recognized organization, however, was 
Budi Utomo (Noble Endeavor), founded in 1908 by Wahidin Sudiro- 
husodo (1857-1917), also a pangreh praja son, graduate of a 
STOVIA predecessor school, and journalist. Wahidin's goal was to 
organize financial support that would allow more priyayi to attend 
Dutch-medium schools; he discovered his most enthusiastic support- 
ers were found among STOVIA students, who formed the core of 
Budi Utomo. In 1909 a Surakarta batik merchant, Samanhudi (1868- 
1956), asked Tirtoadisuryo to organize native businessmen, appar- 
ently in response to Chinese competition in the trade. The result was 
the Sarekat Dagang Islam (Islamic Trade Association), which in 1912 
became the Sarekat Islam (Islamic Association). Now under the lead- 
ership of Haji Umar Said (H. U. S.) Cokroaminoto (1882-1934), an 
OSVIA graduate who had left government service, the Sarekat Islam 
had as one of its major goals the expansion of education of, especially, 
lower priyayi, and as a result the colonial government initially reacted 
approvingly, as it had done with Budi Utomo. 

Cokroaminoto's personal charisma, and his ability to use religion 
to attract wide public interest, helped the organization expand rap- 
idly — perhaps to 2 million members in 1919 — and this mass base in 
turn attracted those with quite different political interests. Founded 
in 1913 by the Dutch radical socialist Hendrik Sneevliet (1883- 
1942), the Indies Social-Democratic Association (ISDV), a small 
leftist party that had at first sought an audience in Eurasian groups 
and among laborers in modern industries, turned to Sarekat Islam. 
The young Javanese railway worker Semaun (1899-1971) and the 
Minangkabau journalist Abdul Muis (1890-1959) propagated radi- 
cal Marxist ideas among followers of Sarekat Islam, which eventu- 
ally split over political issues. The ISDV in 1920 became the 
Communist Association of the Indies (PKH), which after 1924 was 
known as the Indonesian Communist Party (PKI — see Glossary). 
The Muslim organization Muhammadiyah (Followers of Muham- 
mad) was founded in Yogyakarta in 1912 by Kiyai Haji Muhammad 
Dahlan (1869-1933), a reforming "modernist" who had joined Budi 
Utomo three years earlier and had been encouraged by its members 
to establish modern Muslim schools. Muhammadiyah, and its "tradi- 
tionalist" counterpart Nahdlatul Ulama, founded in Surabaya in 1926 
by Kiyai Haji Hasyim Asyari (1871-1947), became very large and 
important associations, but their focus was primarily on educational 
and social affairs. 



43 



Indonesia: A Country Study 

Formation of Political Parties, 1911-27 

All of these organizations, and the myriad student groups that 
sprang up after 1915 under names such as Young Java (Jong Java), 
the Young Sumatrans' Association (Jong Sumatranen Bond), and 
Minahasa Students' Association (Studerende Vereniging Minahasa), 
had similar Western-oriented, upper-class, younger-generation, new 
priyayi outlooks and expressed similar dissatisfactions with — and 
sought one or another degree of emancipation from — the colonial 
state. Initially none of theih articulated a national idea. Then one 
organization ventured down that path: the Indies Party (Indische 
Partij), founded in 1911 by the radical Eurasian E. F. E. Douwes 
Dekker (1879-1950), grandson of Multatuli's brother Jan. The 
younger Douwes Dekker was later joined by two Javanese, Cipto 
Mangunkusumo (1886-1943), a STOVIA graduate and charter 
member of Budi Utomo, and Raden Mas Suwardi Suryaningrat 
(1889-1959), an aristocrat of the Pakualaman, STOVIA student, and 
journalist. After 1922, under the name Ki Hajar Dewantara, Suwardi 
became an important leader in the field of education by establishing 
the private Taman Siswa (Student Garden) schools. 

Douwes Dekker and the Indies Party not only called for indepen- 
dence of the colony but argued, using Austria-Hungary, Switzerland, 
and the United States as supporting examples, that all those who 
called the archipelago home should be citizens regardless of race. He 
called for a nation and nationalism that were modern and multiethnic. 
In 1913 Suwardi published an article entitled "Als ik eens een Neder- 
lander was" (If I were a Dutchman), which, with famously acid 
humor, suggested that, if he were a Dutch person celebrating the cen- 
tennial of liberation from Napoleonic rule in that year, he would not 
let the natives of the colony know about it, as they might get ideas 
about freedom, too. This was too much for the colonial government, 
which promptly banned the party and exiled its three leaders to the 
Netherlands for six years. 

It was precisely there and at that time, however, that the idea of 
Indonesia (from the Greek indos — for India — and nesos — for island) 
was taking shape. The term was coined by mid-nineteenth-century 
English observers, who meant it in a general ethnographic or geo- 
graphic sense. Europeans, including the Dutch, found the word 
descriptively handy, and it was used in learned circles in the early 
twentieth century. That is when the small number of indigenous stu- 
dents who came from the Netherlands Indies encountered it. Austra- 
lian historian Robert E. Elson reports that the first recorded uses of 
the words "Indonesia" and "Indonesians" by an indigenous speaker 
were in 1917 public talks by the musicologist Raden Mas Sonder 



44 



Historical Setting 



Suryaputra in The Hague and Baginda Dahlan Abdullah in Leiden. 
They used the phrase "we Indonesians" and spoke of the right of 
Indonesians "to share in the government of the country." In 1922 the 
organization of Indonesian students in the Netherlands changed its 
name from the Indies Association (Indische Vereniging) to Indone- 
sian Association (Indonesische Vereniging), the first organization to 
use the word "Indonesia" (in Dutch) in its name. When Suwardi 
gave a speech at Leiden University using the term a few months 
later, it was clear that both the idea and name of Indonesia had taken 
hold, and the struggle to give it intellectual and practical meaning 
had truly begun. 

It has become customary to describe Indonesia's formative nation- 
alist discourse in terms of three distinct streams of thought (aliran), 
and to emphasize the discord among the "secular" or "territorial," 
Marxist, and Muslim streams; a further division sometimes referred 
to is between "radical" and "moderate" followers. This sort of cate- 
gorization is not entirely beside the point, for it indeed reflects many 
of the tensions and debates that filled the air. The colonial state, 
which founded the Political Intelligence Service (PID) in 1916 in an 
effort to understand the burgeoning political activity among Indone- 
sians, borrowed these categories from the writings and speeches of 
those whom they watched and used them to organize their reports. 
The separation, however, was in some respects artificial. For one 
thing, Indonesians began rather early to speak of the movement 
(pergerakan), by which they meant all efforts that aimed at or pre- 
supposed obtaining freedom (merdeka, kemerdekaan) from Dutch 
rule. Among both sophisticates and more ordinary folk, membership 
in two or more organizations that straddled categories was not 
uncommon, and leaders made a variety of attempts to bridge them, 
for example Muslim and Marxist ideas by the Javanese "Red Haji," 
Mohamad Misbach (7-1926), or Marxist and nationalist principles 
by the Minangkabau Tan Malaka (1897-1949). Still, there was some- 
thing thrilling about both the discord and the struggle to find a way 
out of it, something that suggested not just an intellectual world in 
motion but physical action. 

Already, in 1919 bloody uprisings in Tolitoli, Manado (northern 
Sulawesi), and Cimareme, Garut (western Java), Sarekat Islam had 
been implicated and the specter of a radical, activist Islam raised. 
The colonial state moved in quickly with investigations and arrests. 
In 1925 PKI labor organizers led strikes in the principalities and in 
the cities of Semarang and Surabaya, and in 1926 and 1927 local 
PKI leaders prompted sabotage and rebellion in western Java and 
western Sumatra, respectively. The colonial state responded by 
arresting more than 13,000 people, of whom 4,500 were given prison 



45 



Indonesia: A Country Study 

sentences, and nearly one-third of these were sent to a newly con- 
structed prison camp in remote Boven Digul known as Tanah Merah 
(Red Earth), in Papua. 

The Rise of Sukarno, 1921-26 

At the same time as the colonial government was repressing Mus- 
lim- and Marxist-tinted movements, the "secular" stream was under- 
going significant change. This was principally the work of Sukarno 
(1901-70), son of a Javanese lower priyayi school teacher and a 
middle-class Balinese woman. He attended Dutch-language schools 
in Surabaya, where he boarded in the home of Cokroaminoto, and in 
Bandung, western Java, where he graduated as an architect from the 
new Technical College, one of the best and most expensive schools 
in the colony. Well-read and acquainted with many of the most 
prominent Indonesian political figures of the day, Sukarno first 
established a political study club on the model begun in Surabaya by 
the early Budi Utomo leader Dr. Sutomo (1888-1938), an ophthal- 
mologist, and then, in 1927, a political group which a year later 
became known as the Indonesian Nationalist Party (PNI). The funda- 
mental idea that Sukarno invested in the PNI was that achieving the 
nation — acquiring independence from Dutch rule — came before and 
above everything else, which meant in turn that unity was necessary. 
Quarrels about the role of Islam or Marxist ideas or even democracy 
in an eventual Indonesia were at the moment beside the point. Social 
class was beside the point. All differences dissolved before the need 
for unity in reaching the goal of merdeka. 

In 1921 Sukarno had fashioned the idea of marhaen, the "ordinary 
person" representing all Indonesians, as a substitute for the Marxist 
concept of proletariat, which he found too divisive, and argued that 
developing a mass following among ordinary folk was the key to 
defeating colonial rule. And in 1926 he published a long essay enti- 
tled "Nationalism, Islam, and Marxism," in which he laid the foun- 
dation for a new nationalism, one that was neither Muslim nor 
Marxist but comprised its own — national — ideology, largely by sug- 
gesting that significant differences could not exist among those who 
were serious about struggling for freedom. This extravagant inclu- 
siveness did not, however, extend to race. Sukarno pitched the strug- 
gle as between us (Indonesians) and others, sini or sana (literally, 
here or there), a "brown front" against a "white front." With respect 
to the colonial state, one was either ko or non-Are? (cooperative or 
not). Sukarno specified in the PNI statutes that non-Indonesians — 
Eurasians, Chinese, whites — could aspire only to associate member- 
ship at best. In his 1930 defense oration when on trial by the colonial 



46 



Historical Setting 



authorities, entitled "Indonesia Menggugat!" (Indonesia Accuses!), 
Sukarno also depicted the Indonesian nation as not merely an inven- 
tion of the present but rather a reality of the historical past now being 
revived. It was a glorious (racial) past leading through a dark present 
to a bright and shining future. 

These ideas, delivered in Sukarno's famously charismatic style, 
were both radical and seductive. Part of their attraction was that they 
stirred deep emotions; in part, too, they permitted, even encouraged, 
the denial of genuine differences among Indonesians, and the high- 
lighting of those between Indonesians and others. Not everyone 
agreed with the PNI program, even among those who joined. Moham- 
mad Hatta (1902-80) and Sutan Syahrir (1909-66), Sumatrans who 
were among Sukarno's closest associates and later served him as vice 
president and prime minister, respectively, both had misgivings about 
the "mass action" approach and warned as early as 1929 against dem- 
agoguery and the growth of an intellectually shallow nationalism. 
Syahrir also was scathing about the sini or sana concept, especially 
for the way it implied an unbridgeable gap between East and West, a 
concept Syahrir thought both mythical and dangerous. Hatta was per- 
haps more equivocal, for in the Netherlands in 1926, as president of 
the Perhimpunan Indonesia (Indonesian Association), which had suc- 
ceeded the Indonesische Vereniging, he had specifically prohibited 
Eurasians from membership. 

The encompassing, driving sense of national unity and the defiant 
stand against colonial rule were, nevertheless, widely appealing and 
influenced Indonesians everywhere. They were clearly an inspiration 
behind the decisions of the Second Youth Congress in 1928, which 
adopted the red-and-white flag and the anthem "Indonesia Raya" (Great 
Indonesia) as official national icons, and on October 28, 1928, passed 
the resolution known as the Youth Pledge (Sumpah Pemuda), which 
proclaimed loyalty to "one birthplace/fatherland (bertumpah darah satu, 
tanah air): Indonesia; one people/nation (satu bangsa): Indonesia; and 
one unifying language (bahasa persatuan): Indonesian." Little matter 
that, for example, the Malay language on which this new "Indonesian" 
was to be based was at the time little spoken among the Dutch-educated 
students who proclaimed it the national language; they would learn and 
develop it as they developed the nation itself. 

Colonial Government Reactions, 1927-40 

The colonial government found this new Indonesian nationalism at 
least as revolutionary, and at least as frightening, as it had the prospects 
of Muslim or Marxist revolution. In 1927-28 Hatta and several other 
Perhimpunan Indonesia members were arrested in the Netherlands and 



47 



Indonesia: A Country Study 

charged with fomenting armed rebellion, but acquitted. In the East 
Indies, after his arrest and trial in 1929-30, Sukarno served two years 
in prison. Taken into custody again in 1933, he was held under house 
arrest, first in remote Ende, Flores, then in Bengkulu, western Sumatra, 
until the Japanese occupation (see The Japanese Occupation, 1942-45, 
this ch.). Hatta and Syahrir were arrested in 1934 and sent to Boven 
Digul, and two years later to Banda Neira, Maluku, also for the 
remainder of Dutch rule. These and other arrests of leaders, along with 
ever-tighter political surveillance, crippled noncooperating parties and 
curbed public anticolonial expression but did not halt the spread of 
nationalist sentiment. 

In 1932 the government, convinced — with some justification — 
that privately run Indonesian schools (for example, Ki Hajar Dewan- 
tara's Taman Siswa schools and schools supported by Muhammadi- 
yah and by various political parties like the PNI) were nationalist 
breeding grounds, attempted to subject them to strict state control in 
a so-called Wild Schools Ordinance. The outcry was so loud and so 
unequivocal, even among the most cooperative groups, that the ordi- 
nance had to be modified, and in the following decade the number of 
Indonesian-run and -financed private schools grew rapidly. Far more 
Indonesians, particularly those from an expanding urban middle 
class, sought a modern education than the colonial government was 
able or willing to satisfy; the Indonesian intelligentsia took the initia- 
tive themselves, and effectively used the opportunity to further a 
nationalist agenda. History lessons, for example, did not follow the 
colonial curriculum but emphasized the glories of Majapahit and 
made national heroes of all those who had fought Dutch forces, such 
as Diponegoro. These schools had a significant impact. By the end 
of the 1930s in the city of Surabaya, for instance, they enrolled four 
times as many students as the government schools. 

The attempts of the colonial government during the 1930s to 
repress Indonesian nationalism were associated particularly with 
Governor General B. C. de Jonge (in office 1931-36), infamous for 
his remark that the Dutch had already ruled the Indies for 350 years 
and were going to do so for 350 years more. Not everyone in the 
European community agreed with these hardline views, and some 
supported greater autonomy from The Hague so that they could run 
the Indies as they wished. Some voted in favor of the Sutarjo Peti- 
tion of 1936, which modestly sought approval for a conference to 
consider dominion status for the Netherlands East Indies in 10 years' 
time (it was later rejected by the Dutch government); others com- 
plained aloud that the East Indies had become a police state. But the 
approaching war made the thought of change even less, not more, 



48 




Prints and Photographs Division, 
U.S. Office of War Information 
Collection, LC-USE613-D- 
010623, digital ID fsa 8bl3123 



Royal Netherlands Indies Army 



Courtesy Library of Congress 



soldiers in training during 



World War II 




likely. The Netherlands fell to Hitler's forces on May 10, 1940, leav- 
ing the colony more or less to its own devices. Six months later, the 
colonial government made it clear that it was unalterably opposed to 
Indonesia merdeka — a free Indonesia — and therefore to the Indone- 
sian national idea as it had developed to that time; no real accommo- 
dation was possible. Little wonder that by that time a great many 
thoughtful Indonesians, even the most moderate, had concluded that 
only the shock and dislocation of war in the archipelago might — 
possibly — bring about changes favorable to them. 

War and Early Independence 

The Japanese Occupation, 1942-45 

Japan's decision to occupy the Netherlands East Indies was based 
primarily on the need for raw materials, especially oil from Sumatra 
and Kalimantan. Shortly after the attack on Pearl Harbor, Japanese 
forces moved into Southeast Asia. The occupation of the archipelago 
took place in stages, beginning in the east with landings in Tarakan, 
northeastern Kalimantan, and Kendari, southeastern Sulawesi, in 
early January 1942, and Ambon, Maluku, at the end of that month. 
At the beginning of February, Japanese forces invaded Sumatra from 
the north, and at the end of the month, the Battle of the Java Sea 
cleared the way for landings near Bantam, Cirebon, and Tuban, on 
Java, on March 1 ; Japanese forces met with little resistance, and the 
KNIL announced its surrender on March 8, 1942. 

The occupation was to last for 42 months, from March 1942 until 
mid- August 1945, and this period properly belongs to Indonesia's 
colonial era. Indonesians who had cautiously welcomed the idea of a 
Japanese victory because it might advance a nationalist agenda were 



49 



Indonesia: A Country Study 

disappointed by Japan's initial actions. The idea that the colony 
might form a national unit did not appeal to the new power, which 
divided the territory administratively between the Japanese Imperial 
Army and the Japanese Imperial Navy, with the Sixteenth Army in 
Java, the Twenty-fifth Army in Sumatra (but headquartered until 
1943 in Singapore, afterwards in Bukittinggi, western Sumatra), and 
the navy in the eastern archipelago. As late as May 1943, these areas 
were — unlike the Philippines and Burma — slated to remain perma- 
nent imperial possessions, colonial territories rather than autono- 
mous states, within the Greater East Asia Co-Prosperity Sphere. 
Some Japanese pan-Asianists and national idealists did have notions 
that Japan's true duty was to bring independence to Indonesia, but 
they had little real influence on imperial policy. And less than two 
weeks after the Dutch surrender, the Japanese military government 
on Java not only banned all political organizations but prohibited the 
use of the red-and-white flag and the anthem "Indonesia Raya." Sim- 
ilar restrictions were enforced even more stringently in the other 
administrative areas. 

Generalizing about Indonesia during the 1942^5 occupation 
period is extraordinarily difficult, not only because of varying poli- 
cies and conditions in the separate administrative divisions, but also 
because circumstances changed rapidly over time, particularly as the 
war turned against Japan, and because Indonesians' experience var- 
ied widely according to, among other things, their social status and 
economic position. 

The occupation is remembered as a harsh time. Japanese military 
rule was severe, and fear of arrest by the Kenpeitai (military police) 
and of the torture and execution of those who defied or were sus- 
pected of defying the Japanese was widespread. Particularly after 
mid- 1943, economic conditions worsened markedly as a result of the 
wartime disruption of transportation and commerce, as well as mis- 
guided economic policies. Most urban populations were protected 
from extremes by government rationing of necessities, but severe 
food shortages and malnutrition developed in some areas, and cloth 
and clothing became so scarce by 1 944 that villagers in some regions 
were reduced to wearing crude coverings made of old sacking or 
sheets of latex. The unrelenting mobilization of laborers — generally 
lumped under the infamous Japanese term romusha (literally, man- 
ual workers but in Indonesia always taken to mean forced labor) — 
came to represent in both official and public Indonesian memory the 
cruelty and repression of Japanese rule. Exact numbers are impossi- 
ble to determine, but the Japanese drafted several million Javanese 
for varying lengths of time, mostly for local projects. As many as 
300,000 may have been sent outside of Java, nearly half of them to 



50 



Historical Setting 



Sumatra and others as far away as Thailand. It is not known how 
many actually returned at the end of the war, although about 70,000 
are recorded as being repatriated from places other than Sumatra by 
Dutch services; nor is it clear how many romusha died, were injured, 
or fell ill. But the casualties were undoubtedly very high, for in most 
cases the conditions were extremely grim. 

The new priyayi and the urban middle classes, however, were 
often shielded from these extremes and often took a more equivocal 
attitude toward Japanese rule. They filled many of the positions left 
vacant by Dutch civil servants interned by the Japanese, and also vied 
for pangreh praja positions dominated by members of the traditional 
elite or those who had attended government schools. They also 
applauded the Japanese policies that ended dualism in education and 
the courts, and were receptive to Japanese pan-Asian East-versus- 
West sensibilities ("Asia for the Asians" as opposed to white suprem- 
acy, and "Asian values" as opposed to "Western materialism"). The 
priyayi and the middle classes also recognized the enormous advan- 
tages nationalist leaders had, however much the Japanese sought to 
control them, when they appeared before huge crowds and were fea- 
tured in the newspapers or on the radio. Few expected much from the 
obviously propagandistic Japanese efforts to mobilize public support 
through a series of mass organizations, such as the Center of the Peo- 
ple's Power (Putera) and the Jawa Hokokai (Java Service Associa- 
tion), or from the "political participation" promised through advisory 
groups formed at several administrative levels, including the Chuo 
Sangi-In (Central Advisory Council) for Java. Observers began to 
notice, however, that Sukarno and Hatta, both of whom had been 
released from Dutch internment by the Japanese in 1942, managed to 
slip nationalist language into their speeches, and the formation of the 
volunteer army known as Defenders of the Fatherland (Peta) in late 
1943 was seen as an enormous step in furthering nationalist goals, 
one that of course could never have taken place under the Dutch. 

Both Sukarno and Hatta agreed to cooperate with the Japanese in 
the belief that Tokyo was serious about leading Indonesia toward 
independence; they were, in any case, convinced that outright refusal 
was too dangerous. (Syahrir declined to play a public role.) Their 
cooperation was a dangerous game, which later earned both leaders 
criticism, especially from the Dutch and the Indonesian political left, 
for having been "collaborators." Sukarno's role in recruiting 
romusha became a particularly sore issue, although he later stub- 
bornly defended his actions as necessary to the national struggle. 
Some Muhammadiyah and Nahdlatul Ulama leaders followed 
Sukarno's cooperative lead, seeing no reason why, if the Japanese 
were trying to use them to mobilize Muslim support, they should not 



51 



Indonesia: A Country Study 

use the Japanese to advance Muslims' agenda. They saw some 
advantage in the formation of the Consultative Council of Indone- 
sian Muslims (Masyumi), which brought modernist and traditionalist 
Muslim leaders together, and of its military wing, the Barisan His- 
bullah (Army of God), intended as a kind of Muslim version of Peta. 
But on the whole, Muslim enthusiasm for cooperation with the Japa- 
nese did not match Sukarno's. 

Another group that was initially enthusiastic about the Japanese 
victory was made up of somewhat younger (mostly under 30), less 
established, but educated, urban, and mostly male, individuals. 
Many had been jailed or under surveillance in the late Dutch period 
for their political activism. They were courted by the Japanese and 
filled positions in news agencies, publishing, and the production of 
propaganda. Referred to loosely as pemuda (young men), they rap- 
idly developed nationalist sentiments, eventually turning bitterly 
against Japanese tutelage and coming to play an important role in 
events after the occupation. 

In April 1944, U.S. forces occupied the town of Hollandia (now 
called Jayapura) in Papua, and in mid-September Australian troops 
landed on Morotai, Halmahera (Maluku); toward the end of the 
month, Allied planes bombed Jakarta (as Batavia had been renamed) 
for the first time. Mindful of this new, critical stage of the conflict, 
Japan's new prime minister, Koiso Kuniaki, announced on September 
7, 1944, that the Indies (which he did not define) would be prepared 
for independence "in the near future," a statement that appeared at 
last to vindicate Sukarno's cooperative policies. Occupation authori- 
ties were instructed to further encourage nationalist sentiments in 
order to calm public restlessness and to retain the loyalty of cooperat- 
ing nationalist leaders and their followers. Their response was com- 
paratively slow, but spurred perhaps by evidence of growing anti- 
Japanese sentiment — in mid-February 1945, for example, a Peta unit 
in Blitar (eastern Java) revolted — the authorities on Java announced 
on March 1, 1945, their intention to form the Commission to Investi- 
gate Preparatory Measures for Independence (BPUPK); the term 
"Indonesia" was initially not used. Its membership — 54 Indonesians, 
four Chinese, one Arab, and one Eurasian, plus eight Japanese "spe- 
cial members" — was announced on April 29. Meetings began on 
May 28. 

The BPUPK took up questions such as the philosophy, territory, 
and structure of the state. Sukarno's speech on June 1 laid out what 
he called the Pancasila (see Glossary) or Five Principles, which were 
acclaimed as the philosophical basis of an independent Indonesia. In 
the original formulation, true to Sukarno's prewar thinking, national 
unity came first, and while religion ("belief in a One and Supreme 



52 



Historical Setting 



God") was recognized in the fifth principle, one religion was point- 
edly not favored over another, and the state would be neither secular 
nor theocratic in nature. Thirty-nine of 60 voting members of the 
BPUPK voted to define the new state as comprising the former 
Netherlands East Indies as well as Portuguese Timor, New Guinea, 
and British territories on Borneo and the Malay Peninsula. Spirited 
debate on the structure of the state led finally to the acceptance of a 
unitary republic. An informal subcommittee, in a decision subse- 
quently dubbed the Piagam Jakarta (Jakarta Charter), suggested that 
Muslim concerns about the role of Islam in the new state be 
addressed by placing Sukarno's last principle first, requiring that the 
head of state be a Muslim, and adding a phrase requiring all Muslim 
citizens to follow the sharia. This declaration was to be the source of 
continuing misunderstanding. 

The United States dropped atomic bombs on Hiroshima and Naga- 
saki, respectively, on August 6 and 8, 1945, and the Japanese rushed 
to prepare Indonesian independence. Vetoing the "Greater Indonesia" 
idea, military authorities required that the new state be limited to the 
former Netherlands East Indies and called for the establishment of an 
Indonesian Independence Preparatory Committee (PPKI) with 
Sukarno as chairman. This group was established on August 12, 
1945, but Japan surrendered three days later, before it had an opportu- 
nity to meet. The established Indonesian leadership, led by Sukarno 
and Hatta, greeted the surrender with initial disbelief and caution, but 
some pemuda, many of them followers of Sutan Syahrir, took a more 
radical stance, kidnapping Sukarno and Hatta on the night of August 
15-16 in an effort to force them to declare independence immediately 
and without Japanese permission. Their efforts may actually have 
delayed matters slightly, as Hatta later accused, but in any case, in a 
simple ceremony held before a small group in the front yard of his 
home at 10:00 AM on August 17, 1945, Sukarno, after a brief speech, 
delivered a two-sentence statement officially proclaiming indepen- 
dence and noting that "details concerning the transfer of authority, 
etc., would be worked out as quickly and thoroughly as possible." 

The next day, the PPKI met for the first time to adopt a constitu- 
tion. Some key stipulations of the Jakarta Charter were cancelled, 
with the suggestion that such issues be revisited later, but the version 
of Pancasila that now became the official creed of the Republic of 
Indonesia began with the principle of "belief in [one supreme] God," 
followed by humanitarianism, national unity, popular sovereignty 
arrived at through deliberation and representative or consultative 
democracy, and social justice. Such was the idealistic vision of a 
national civic society with which Indonesia began its independent life. 



53 



Indonesia: A Country Study 

The National Revolution, 1945-49 

The struggle that followed the proclamation of independence on 
August 17, 1945, and lasted until the Dutch recognition of Indonesian 
sovereignty on December 27, 1949, is generally referred to as Indo- 
nesia's National Revolution. It remains the modern nation's central 
event, and its world significance, although often underappreciated, is 
real. The National Revolution was the first and most immediately 
effective of the violent postwar struggles with European colonial 
powers, bringing political independence and, under the circum- 
stances, a remarkable degree of unity to a diverse and far-flung nation 
of then 70 million people and geographically the most fragmented of 
the former colonies in Asia and Africa. Furthermore, the Revolution 
accomplished this in the comparatively short period of slightly more 
than four years and at a human cost estimated at about 250,000 lives, 
far fewer than the several million suffered by India or Vietnam, for 
example. Representatives of the Republic of Indonesia were the first 
former colonial subjects to successfully use the United Nations (UN) 
and world opinion as decisive tools in achieving independence, and 
they carried on a sophisticated and often deft diplomacy to advance 
their cause. At home, it can certainly be argued that Republican 
forces fought a well-armed, determined European power to a stand- 
still, and to the realization that further colonial mastery could not be 
achieved. Finally, although this point is much debated, it can be 
argued that the National Revolution generated irreversible currents of 
social and economic change marking the final disappearance of the 
colonial world and — for better or worse — serving as the foundation 
for crucial national developments over the next several generations. 
These were no mean achievements. 

The new Republic's prospects were at best uncertain, however. 
The war had ended very suddenly, and the Dutch — themselves only 
recently freed from Nazi rule — were unable to reestablish colonial 
authority, a task that in Sumatra and Java fell to British and British 
Indian troops, the first of which did not arrive until September 29, 
1945. In the interval of nearly six weeks, the Republic of Indonesia 
was able to disarm a great many Japanese troops and form a govern- 
ment with Sukarno as president and Hatta as vice president. The 
Central National Committee (KNIP) was established as the principal 
decision-making body. It had regional and local subcommittees, 
based largely on the structure and personnel of the Jawa Hokokai. A 
comparatively smooth transition to an Indonesian-controlled bureau- 
cracy and civil service took place in most areas, especially of Java. 
Australian troops continued occupying the eastern archipelago in 
late 1944 and, in 1945, accompanied by Dutch military and civilian 



54 



mm 



Street scene with a military truck and walls with slogans, 
during the Indonesia war for independence in 1945 
Courtesy Library of Congress Prints and Photographs Division, 
Lot 9033, LC-USZ62-43524, digital ID cph 3a42 771 

personnel of the Netherlands Indies Civil Administration (NICA), 
which had formed in Australia during the war. 

At the same time, however, tensions arising in part from conflict 
with Japanese troops, now charged by Allied commander Earl Louis 
Mountbatten (1900-79) with keeping the peace until his own troops 
could arrive, and in part from the release of Europeans who had been 
imprisoned by the Japanese and now sought to resume their lives, 
exploded. Radical pemuda initiated, and encouraged others to take 
part in, violence against all those — not only Dutch and Eurasians but 
also Chinese and fellow Indonesians — who might be suspected of 
opposing independence. Sukarno's government was powerless to 
stop this bloodletting, which by the end of September was well 
underway on Java. It grew in intensity and spread to deadly attacks 
on local elites as Allied troops moved to secure the main cities of 
Java and Sumatra. This sort of violence did not endear the Revolu- 
tion to the outside world or, for that matter, to many Indonesians, but 
at the same time it was clear that closely allied to it was a fierce 
determination to defend independence. When Allied troops landed in 
Surabaya in late October 1945, their plans to occupy the city were 
thwarted by tens of thousands of armed Indonesians and crowds of 
city residents mobilized by pemuda, resulting in the death of the 
British commander and hundreds of his men. The ferocious British 
counterattack that began on November 10, enshrined in Indonesian 



55 



Indonesia: A Country Study 

nationalist history as Heroes' Day, is estimated to have killed 6,000 
Indonesians and others, a terrible defeat that nevertheless convinced 
the British that they must plan for eventual withdrawal. A year later, 
the British turned military affairs over to the Dutch, who were deter- 
mined to restore their rule throughout the archipelago. 

In general, the Dutch view in late 1945 had been that the Republic 
of Indonesia was a sham, controlled largely by those who had collab- 
orated with the Japanese, with no legitimacy whatsoever. A year later, 
this outlook had been modified somewhat, but only to concede that 
nationalist sentiment was more widespread than they had at first 
allowed; the complaint grew that, whatever its nature, the Republic 
could not control its violent supporters (especially pemuda and com- 
munists), making it unfit to rule. Attempts to broker a peaceful settle- 
ment of this postcolonial conflict were unsuccessful. The first, the 
Linggajati Agreement of November 12, 1946, acknowledged Repub- 
lican control on Sumatra, Java, and Madura, as well as a federation of 
states under the Dutch crown in the eastern archipelago. The agree- 
ment also called for the formation, by January 1, 1949, of a federated 
state comprising the entire former Netherlands Indies, a Netherlands- 
Indonesian Union, or the so-called United States of Indonesia, which 
was also to be part of a larger commonwealth (including Suriname 
and the Dutch Antilles) under the Dutch crown. The Linggajati 
Agreement was not popular on either side and was not ratified until 
months later. Among many Indonesian nationalists of various politi- 
cal stripes, the agreement was seen as a capitulation by the Republi- 
can government. Pemuda of both left and right championed the idea 
of "100 percent Independence" (Seratus Persen Merdeka), and the 
communist-nationalist Tan Malaka coupled this with accusations that 
both Sukarno and Hatta had betrayed the nation once with their col- 
laboration with the Japanese, and were doing so once again by com- 
promising with the Dutch. Tan Malaka formed a united front known 
as the Struggle Coalition (Persatuan Perjuangan), which used the idea 
of total opposition to the Dutch to gather support for his own political 
agenda. 

Less than two months after the KNIP had, following bitter debate 
and maneuvering, approved the agreement, Dutch forces launched 
what they euphemistically called a "police action" against the 
Republic, claiming it had violated or allowed violations of the Ling- 
gajati Agreement. They secured most of the large cities and valuable 
plantation areas of Sumatra and Java and arbitrarily established 
boundaries between their territories and the Republic, known as the 
Van Mook Line, after Lieutenant Governor General H. J. van Mook. 
The Republican military, the Indonesian National Army (TNI), and 



56 



Historical Setting 



its affiliated militia (laskar) were humiliated, and yet greater criti- 
cism of the government arose, now even from within the military 
itself and from Muslim leaders. 

The Republic had from the start of the Revolution pursued a vig- 
orous if informal diplomacy to win other powers to its side, efforts 
that now bore fruit. The UN listened sympathetically to Prime Min- 
ister Syahrir's account of the situation in mid- August 1947, and a 
month later announced the establishment of a Committee of Good 
Offices, with members from Australia, Belgium, and the United 
States, to assist in reaching a settlement. The result was the Renville 
Agreement, named for the U.S. Navy ship — considered neutral terri- 
tory — on which it was negotiated and signed between January 17 
and 19, 1948. But this accord proved even less popular in the Repub- 
lic than its predecessor, as it appeared to accept both the Van Mook 
Line, which in fact left numbers of TNI troops inside Dutch-claimed 
territories, requiring their withdrawal, and the Dutch notion of a fed- 
eration rather than a unitary state pending eventual plebiscites. 
Republican leaders reluctantly signed it because they believed it was 
essential to retaining international goodwill, especially that of the 
United States. In the long run, they may have been correct, but the 
short-term costs were enormous. 

Internally the Republic was threatening to disintegrate. Public 
confidence in the Republic began to erode because of the worsening 
economic situation, caused in part by the Dutch blockade of sea trade 
and seizure of principal revenue-producing plantation regions, as 
well as by a confused monetary situation in which Dutch, Republi- 
can, and sometimes locally issued currencies competed. Conflict 
became more frequent between the TNI and laskar and among 
laskar, as they competed for territory and resources or argued over 
tactics and political affiliation. The KNIP initiated a reorganization 
and rationalization program in December 1947, seeking to reduce 
regular and irregular armed forces drastically in order the better to 
supply, train, and control them. To patriots as well as those with other 
motives, this move seemed no better than treason, and the result was 
chaos. In addition, tensions mounted rapidly and at all levels between 
Muslims and both the government and leftist forces. Local clashes 
were reported in eastern and western Java after early 1948, but the 
most immediate challenge to the Republic was the movement led by 
S. M. Kartosuwiryo (1905-62), a foster son of H. U. S. Cokroamin- 
oto, who had supported the 1928 Youth Pledge and pemuda national- 
ists in 1945 but later felt betrayed by the Renville Agreement and 
took up arms against the Republic, with himself at the head of an 
Islamic Army of Indonesia (Til). In the Garut-Tasikmalaya region of 



57 



Indonesia: A Country Study 



western Java in May 1948, Kartosuwiryo declared a separately 
administrated area, Darul Islam (Abode of Islam), which in 1949 he 
called the Islamic State of Indonesia (Nil). He was captured and exe- 
cuted in 1962 by units of the armed forces. 

Most serious of all, however, was the upheaval precipitated in 
September 1948 by the return from the Soviet Union of the prewar 
communist leader Muso (1897-1948), and his efforts to propel the 
PKI to a position of leadership in the Revolution. He berated the 
Sukarno-Hatta leadership for compromising with the Dutch and 
called for, among other things, an agrarian revolution. Driven by 
these new tensions, and animosities generated by the reorganization 
of the TNI, fighting broke out in Surakarta, central Java, between 
forces sympathetic to the PKI and the Republic. On September 18, 
PKI-affiliated laskar took over the eastern Java city of Madiun, 
where they murdered civil and military figures, announced a 
National Front government, and asked for popular support. The 
Republic responded immediately with a dramatic radio speech by 
Sukarno calling on the masses to choose between him — and the 
nation — or Muso. The TNI, especially western Java's Siliwangi 
Division under Abdul Haris Nasution (1918-2001), mounted a bru- 
tally successful campaign against the rebel forces. Muso and other 
PKI leaders were killed, and all told approximately 30,000 people 
lost their lives on both sides in the conflict. 

The Madiun Affair remains controversial today, but its outcome 
strengthened the Republican government's efforts to control those 
who opposed it and changed the way in which Sukarno and the 
Republic were seen overseas, especially in the United States, where in 
the Cold War paradigm Indonesia now appeared as an anticommunist 
power. In the months after Madiun, the Dutch grew increasingly frus- 
trated. Their negative portrayal of the Republic had lost international 
credibility, and on the ground their military position was deteriorat- 
ing. Intelligence indicated as many as 12,000 Indonesian troops oper- 
ating inside the Van Mook Line. On December 19, 1948, Dutch forces 
launched an attack — styled a second "police action" — designed to 
destroy the Republic, occupying its capital of Yogyakarta and captur- 
ing and imprisoning Sukarno, Hatta, five other cabinet members, and 
Syahrir (then an adviser). In response to this outright defiance, the 
UN Security Council demanded the reinstatement of the Republican 
government, and a full transfer of sovereignty to Indonesia no later 
than July I, 1950. International pressure, which included a U.S. threat 
to withdraw Marshall Plan aid from the Netherlands, was too great for 
The Hague to withstand. At the same time, the Republic had initiated 
a guerrilla war (gerilya) against Dutch forces immediately after the 



58 



People s Security Forces machine gunner, 1946 
Courtesy Library of Congress Prints and Photographs Division, 
LC-USZ62-1 37192, digital ID cph 3c37192 

fall of Yogyakarta. The significance of this gerilya has been generally 
underestimated, largely because it involved TNI struggles against 
armed internal opposition (for example, by the Nil in western Java 
and by those loyal to Tan Malaka, who was captured and killed in 
eastern Java in February 1949) as well as Dutch forces. But Indone- 
sian resistance was sufficiently effective to convince Dutch com- 
manders that this was a war that could not be won on the ground. 

After two efforts at cease-fires between May and August 1949, 
the Round Table Conference met in The Hague from August 23 to 
November 2 to reach the final terms of a settlement. The Round 
Table Agreement provided that the Republic and 1 5 federated terri- 
tories established by the Dutch would be merged into a Federal 
Republic of Indonesia (RIS). The Dutch recognized the sovereignty 
of Indonesia on December 27, 1949. Because of widespread fear by 
nationalists in the Republic and in some of the federated territories 
that the structural arrangements of the RIS would favor pro-Dutch 
control, and because the TNI also found it unthinkable that they 
should be required to merge with the very army and police forces 
they had been fighting against, there was considerable sentiment in 
favor of scrapping the federal arrangement. This, and often heavy- 
handed pressure from within the Republican civilian bureaucracy 



59 



Indonesia: A Country Study 



and army, produced within five months a dissolution of the RIS into 
a new, unitary Republic of Indonesia, which was officially declared 
on the symbolic date of August 17, 1950. Only the breakaway 
Republic of South Maluku (RMS) resisted this incorporation. TNI 
forces opposed and largely defeated the RMS in the second half of 
1950, but about 12,000 of its supporters were relocated to the Neth- 
erlands, and there and in Maluku itself separatist voices were heard 
for the next half-century. 

The Road to Guided Democracy, 1950-65 

Recovery 

Developments during the first 15 years of Indonesia's indepen- 
dent history have been comparatively little studied in recent years 
and tend to be explained in rather simple, dichotomous terms of, for 
example, a struggle between "liberal democracy" and "primordial 
authoritarianism," between pragmatic "problem solvers" and idealis- 
tic "solidarity builders," or between political left and right. These 
analyses are not entirely wrong, for Indonesia was indeed polarized 
during these years, but they tend to oversimplify the poles, and to 
ignore other parts of the story, such as the remarkable flourishing of 
literature and painting that drew on the sense of personal and cultural 
liberation produced by the National Revolution. The new govern- 
ment also had extraordinary success, despite a lack of funds and 
expertise, in the field of education: in 1930 adult literacy stood at 
less than 7.5 percent, whereas in 1961 about 47 percent of those over 
the age of 10 were literate. It was a considerable achievement, too, 
that Indonesia in 1955 held honest, well-organized, and largely 
peaceful elections for an eligible voting public of nearly 38 million 
people scattered throughout the archipelago, more than 91 percent of 
whom cast a ballot. Still, it is fair to characterize the period as one of 
heavy disillusion as well, in which the enormously high expectations 
that leaders and the public had for independence could not be met, 
and in which the search for solutions was both intense and frag- 
mented. While it may be true, as historian Anthony Reid has sug- 
gested, that the Revolution succeeded in "the creation of a united 
nation," in 1950 that nation was still no more than a vision, and it 
remained to be seen whether the same ideas that had brought it to life 
could also be used to give it substance. 

Perhaps the greatest expectation of independence, shared by mid- 
dle and lower classes, rural as well as urban dwellers, was that it 
would bring dramatic economic improvement. This hope had been 
embedded in the nationalist message since at least the 1 920s, which 



60 



Historical Setting 



had played heavily on the exploitative nature of the colonial econ- 
omy and implied that removal of colonial rule would also remove 
obstacles to economic improvement and modernization. But the con- 
ditions Indonesia inherited from the eras of occupation and Revolu- 
tion were grim, far grimmer than those of neighboring Burma or the 
Philippines, for example, despite the fact that unlike them it had not 
been a wartime battlefield. The Japanese had left the economy weak 
and in disarray, but the Revolution had laid waste, through fighting 
and scorched-earth tactics, much of what remained. In 1950 both 
gross domestic product (GDP — see Glossary) and rice production 
were well below 1939 levels, and estimated foreign reserves were 
equivalent to about one month's imports (and only about three times 
what they had been in 1945). In addition, provisions in the Round 
Table Agreement had burdened Indonesia with a debt to the Nether- 
lands of US$1,125 billion dollars and saddled it with the costs of 
integrating thousands of colonial administrative and military person- 
nel. (No other ex-colony in the postwar era was faced with such a 
debt, 80 percent of which Indonesia had paid when it abrogated the 
agreement in 1956.) 

Economic Pressures 

In the early 1950s, Indonesia's economy experienced a boomlet, 
principally as a result of Korean War (1950-53) trade, especially in 
oil and rubber; taxes on this trade supplied nearly 70 percent of the 
government's revenues. Between 1950 and 1955, the gross national 
product (GNP — see Glossary) is thought to have grown at an annual 
rate of about 5.5 percent, and it increased 23 percent between 
1953 — when real GDP again reached the 1938 level — and 1957. In 
retrospect, economists seem agreed that, against heavy odds, the 
immediate postcolonial economy was not hopeless. Nevertheless, 
what most Indonesians saw and felt did not seem like economic 
progress at all: wages rose, but prices rose faster, and the growing 
ranks of urban workers and government employees were especially 
vulnerable to the resulting squeeze. The government also was 
squeezed between falling trade-tax revenues and rising expenses, 
especially those required to support a bureaucracy that nearly dou- 
bled in size between 1950 and 1960. Infrastructure, badly needing 
rehabilitation, was neglected, adversely affecting production and 
trade. Corruption and crime spread. In 1956 rice made up 13 percent 
of Indonesia's imports, compared to self-sufficiency in 1938; by 
1960 only 10 percent of the national income derived from manufac- 
turing, compared to 12 percent in 1938. In economists' terms this 
was "structural regression," but in everyday experience it meant that 



61 



Indonesia: A Country Study 

the economy was not modernizing, and it was increasingly unable to 
provide for a population estimated to have grown from 77 million in 
1950 to 97 million a decade later. 

In order to solve these problems, the government at first 
embarked on plans — many of which had been initiated by the Dutch 
in the late 1930s and again in territories they held in the immediate 
postwar years — for large- and small-scale industrialization, import- 
substitution manufacturing, and private and foreign capitalization. It 
was not long, however, before policies more familiar to the prewar 
generation of nationalists, now firmly in power, took precedence. 
These were already visible in the Benteng (Fortress) Program 
(1950-57), one aspect of which was discrimination against ethnic 
Chinese and Dutch entrepreneurs in order to foster an indigenous 
class of businessmen. 

The Benteng Program failed, leading instead to more corruption, 
but the call for "Indonesianization" of the economy was very strong. 
Policies increasingly favored a high degree of centralization, govern- 
ment development of state enterprises, discouragement of foreign 
investment, and, at least for a time, the encouragement of village 
cooperatives, all of which harkened back to provisions of the 1 945 
constitution and had been pursued in a limited fashion during the 
National Revolution. Gradual nationalization of some Dutch enter- 
prises, the central bank, the rail and postal services, and air and sea 
transport firms began in the early 1950s, but the pace quickened after 
1955 because of the continuing dispute over West New Guinea, con- 
trol of which had not been settled in 1949. In 1957 and 1958, nearly 
1 ,000 Dutch companies were nationalized and seized by the armed 
forces or, less frequently, by labor groups; in a corresponding exo- 
dus, nearly 90 percent of remaining Dutch citizens voluntarily repa- 
triated. A year later, a decree banning "foreign nationals" resulted in 
100,000 Chinese repatriating to mainland China. A victory from a 
nationalist perspective, this was from an economic standpoint — not 
least of all because Indonesia lacked capital and credit, as well as 
modern management and entrepreneurial skills — a setback from 
which recovery would be difficult. 

Political Developments and Divisiveness 

Independence had also brought with it expectations of a modern 
political framework for the nation. The Republic's founders had 
rejected colonialism, of course, and monarchy, settling on a vaguely 
defined democracy that leaned heavily on presidential authority. The 
constitution of the RIS and a third (provisional) constitution adopted 
in 1950 by the unitary state called for a prime ministerial, multiparty, 



62 



Historical Setting 



parliamentary democracy and free elections. When voters went to 
the polls in September 1955, there was considerable hope that such a 
system would provide solutions to the political divisiveness that, 
freed from the limitations of the common anticolonial struggle, had 
begun to spread well beyond the mostly urbanized educated elite. 

In the event, however, the national elections proved disappointing. 
The four major winners among the 28 parties obtaining parliamen- 
tary seats were the secular nationalist PNI (22 percent, with 86 per- 
cent of that from Java), the modernist Muslim Masyumi (21 percent, 
with 5 1 percent from Java), the traditional Muslim Nahdlatul Ulama 
(18 percent, with 86 percent from Java), and the PKI (16 percent, 
with 89 percent from Java). After the PKI, the next most successful 
party, the Indonesian Islamic Union Party (PSII), received less than 3 
percent of the vote, and 18 of 28 parties received less than 1 percent 
of the vote. Both Nahdlatul Ulama and the PKI, which had especially 
strong fallowings in central and eastern Java, dramatically increased 
their representation compared with what they had held in the provi- 
sional parliament (8 to 45 seats, and 17 to 39 seats, respectively). In 
eastern Java, the vote was split almost evenly among the PNI, PKI, 
and Nahdlatul Ulama. The elections thus exposed and sharpened 
existing divides between Java and the other islands, raising fears of 
domination by Jakarta, and between the rapidly rising PKI and, par- 
ticularly, Muslim parties, raising fears of communist (interpreted as 
antireligious) and populist ascendancy. 

To make matters worse, there was a general perception that in the 
30-month run-up to the elections, the political process had polarized 
villages as parties sought votes. There were many reports of villagers 
being pressured and even threatened to vote for one or another party, 
and of clashes between Muslim and communist adherents. More- 
educated voters tended to take hardened ideological positions. On 
the eve of the elections, Sukarno had declared that anyone who 
"tried to put obstacles in the way of holding them ... is a traitor to the 
Revolution." Barely six months later, he was urging the new parlia- 
ment to avoid "50 percent + 1 democracy," and in October spoke of 
"burying" the political parties and of his desire to see Guided 
Democracy (demokrasi terpimpin, a term Sukarno had been using 
since 1954) in Indonesia. 

Military Involvement and Rebellion 

Into this deteriorating situation, the military increasingly inserted 
itself. During the Revolution, the armed forces had developed a 
strong distrust for — indeed, taken up arms against — both communist 
and Muslim movements that had opposed the central government. 



63 



Indonesia: A Country Study 

The military had also itself exhibited a resistance to control by the 
central government and, especially after the second "police action" 
and subsequent gerilya, a high level of disapproval of civilian poli- 
tics and politicians in general. Further, the armed forces had never 
been united, even on these issues, which made for extremely com- 
plex struggles in which military leaders often ended up opposing 
each other. These tensions surfaced, for example, when a dispute 
over demobilization plans resulted in a dangerous confrontation 
between some army commanders and parliament in Jakarta on Octo- 
ber 17, 1952. 

In 1956, in reaction to Jakarta's continued efforts to curb TNI- 
supported smuggling of oil, rubber, copra, and other export products, 
commanders in Sumatra and Sulawesi bolted from both government 
and central TNI control, arguing that their regions were producing 
more than their share of exports but receiving too little in return from 
the central government. The army was also growing increasingly 
concerned about the PKI's rise to power. PKI membership had leapt 
from about 100,000 in 1952 to a purported 1 million at the end of 
1955, and, more successfully than any other party, it had cultivated 
village interests with community projects and support, particularly 
on Java. At the end of 1956, a dissident TNI commander, Zulkifli 
Lubis (1923-94?), wrote that Sukarno himself, recently returned 
from a visit to the People's Republic of China, had chosen that coun- 
try as a political model. On February 21, 1957, Sukarno, supported 
by army chief Nasution, proposed instituting a system of Guided 
Democracy, which he now conceptualized as based on a politics of 
mutual cooperation (gotong royong) and deliberation with consensus 
(musyawarah mufakat) among functional groups (golongan karya) 
rather than political parties, which he believed was more in keeping 
with the national character. This seemed to many dissidents to signal 
both the end of any hope of improving regional prospects, and the 
beginning of, at the very least, a communist-tinted authoritarian rule. 

In early March 1957, the TNI commander of East Indonesia 
announced Universal Struggle (Permesta) and declared martial law in 
his region, claiming a goal of completing the National Revolution. 
Nasution then proposed that Sukarno declare martial law for all of 
Indonesia, which he did on March 14. In the repression of suspected 
dissidents in Java, especially of Masyumi leaders, who had vigorously 
opposed the institution of Guided Democracy, a number of these 
prominent figures fled to Sumatra. They included the former prime 
minister from 1950-51, Mohammad Natsir (1908-93); former central 
bank president Syafruddin Prawiranegara (191 1-89); and former min- 
ister of finance Sumitro Joyohadikusumo (1917-2001), who joined 
army dissidents in Sumatra, eventually declaring, in mid-February 



64 



Historical Setting 



1958, the Revolutionary Government of the Republic of Indonesia 
(PRRI). They were immediately joined by the Permesta rebels, and 
also attracted the clandestine support of the United States (revealed in 
May when an American pilot was shot down during a rebel attack on 
government forces). The central government acted swiftly, and TNI 
forces broke the rebellion in no more than two months, although spo- 
radic guerrilla fighting continued until the early 1960s. 

It has been pointed out many times that the PRRI did not repre- 
sent a true separatist movement and sought instead what today 
would be termed "regime change." Be that as it may, the revolt was a 
watershed of some importance. Official figures estimate that at least 
30,000 people lost their lives in the fighting, and Indonesian political 
life, far from being improved and stabilized as so fondly hoped, was 
instead gripped by regional, religious, and ideological turmoil and 
bitterness made worse by economic decay. 

Political Paralysis 

Symbolic of the paralysis that gripped political life at the time, the 
Constituent Assembly (Konstituante), which had been elected in late 
1955 and began meeting a year later, by mid- 1959 had failed to 
reach agreement on major issues that had troubled the BPUPK and 
PPKI a decade earlier: whether the form of the state should be feder- 
ative or unitary and whether the state should be based on Islam or 
Pancasila. In May, Jakarta granted the northern Sumatra province of 
Aceh semiautonomous status (and thus the freedom to establish gov- 
ernment by Islamic law) as the price of at last ending the struggle 
there with Darul Islam forces. The way seemed open for a dissolu- 
tion of the unitary state. Sukarno's response on July 5, 1959, was 
unilaterally to dismiss the Constituent Assembly and to declare that 
the nation would return to the constitution of August 18, 1945, point- 
edly without the Jakarta Charter and its Islamic provisions. Illegal 
although it may have been, this was not an entirely unwelcome 
move. Many, although by no means all, Indonesians believed that 
their nation had lost its way, and a return to first principles and senti- 
ments — now rather romantically misimagined — sounded in many 
ways attractive. 

What followed, however, was the rapid development of an authori- 
tarian state in which tensions were not reduced but greatly exacerbated. 
On August 17, 1959, Sukarno attempted to give Guided Democracy 
some precise content by announcing his Political Manifesto (Manipol), 
which included the ideas of "returning to the rails of the Revolution" 
and "retooling" in the name of unity and progress. Manipol was sup- 
plemented with the announcement of a kind of second Pancasila 
describing the foundations of the new state: the 1945 constitution, 



65 



Indonesia: A Country Study 

Indonesian Socialism, Guided Democracy, Guided Economy, and 
Indonesian Identity, expressed in the acronym USDEK. These two for- 
mulations were followed in mid- 1960 with a third, known by the con- 
traction Nasakom, in which Sukarno returned to his 1920s attempts to 
work out a synthesis of nationalism (nasionalisme), religion (agama), 
and communism (komunisme). These ideas formed the basis of what 
was increasingly seen as a state ideology, printed up in fat, red-covered 
books to be used in obligatory indoctrination sessions for civil servants 
and students, and expressed in a rising rhetoric that excoriated the 
nation's internal and external enemies. 

What was once Sukarno's gift for effecting conciliation and work- 
able synthesis now turned sour, and, even to many of its earlier sup- 
porters, the promise of Guided Democracy seemed empty. The 
economy worsened and fell into a spiral of uncontrolled inflation of 
more than 100 percent annually. The army, after 1962 part of a com- 
bined Armed Forces of the Republic of Indonesia (ABRI), and the 
PKI confronted each other increasingly aggressively for control of 
state and society. Sukarno, although casting himself as the great 
mediator and attempting to balance all ideological forces, appeared 
to grow more radically inclined, drawing closer to the PKI and its 
leader, D. N. Aidit (1923-65), and away from Nasution's army. 
Widespread arrests of dissidents, censorship of media, and prohibi- 
tion of "unhealthy" Western cultural influences (for example, danc- 
ing the Twist and listening to the Beatles) darkened Indonesia's 
social and intellectual world. 

Worldview 

Indonesian nationalists had the strong expectation that indepen- 
dence would also bring Indonesia international recognition and a 
place in the family of nations. Admission to the UN in September 
1950 was a first step, and Indonesia quickly adopted an "indepen- 
dent and active" foreign policy, first articulated in 1948 by then Vice 
President Mohammad Hatta, who wished to steer a course between 
the Cold War powers but to do so in a way that was not merely "neu- 
tral." The first fruit of this outlook was the Asia-Africa Conference 
held in Bandung, Jawa Barat Province, in April 1955. This gathering 
of 29 new nations sought to avoid entanglement in the Cold War and 
to promote peace and cooperation; to many it represented the sudden 
coming of age of the formerly colonized world. It is generally con- 
sidered the beginning of the Nonaligned Movement (see Glossary), 
although the movement itself was not formalized until 1961. 

Sukarno was in his element at Bandung, speaking eloquently 
about ex-colonial peoples "awakening from slumber" and propos- 



66 




Sukarno, president of Indonesia from 1945 to 1967. 
This photograph was taken during his trip to Washington, DC, on May 16, 1956. 

Courtesy Library of Congress Prints and Photographs Division, 
U.S. News and World Review Collection, digital ID cph 3c34160 

ing — true to his homegrown pattern — an ideology of neither capital- 
ism nor communism but one that merged the nationalism, religion, 
and humanism of Asia and Africa. As at home, however, this grand 
attempt at balance and synthesis did not hold. The failure of Indone- 
sian nonalignment policies during the Cold War came about in part 
because of the unwillingness of the superpowers, perhaps especially 
the United States, to view the decolonized world in anything but 
friend-or-foe terms. Sukarno's willingness to use Cold War rivalries 
for what he viewed as Indonesia's national interests, which was not 
precisely in the spirit of Bandung, also led to the abandonment of 
neutrality. 

In the ongoing dispute with the Dutch over West New Guinea, for 
example, Sukarno had tentatively used the support of the Soviet Union 
and China, and of the PKI at home, to encourage the United States to 
pressure the Dutch to abandon the territory, implicitly in hopes of 
forestalling an Indonesian slide toward the communist bloc. A U.S.- 
and UN-brokered agreement turned over control to Indonesia in May 
1963, which was confirmed in the much-disputed Act of Free Choice 
in 1969. In the issues that arose over the formation of Malaysia — an 



67 



Indonesia: A Country Study 

idea that had surfaced in 1961 as a solution to British decolonization 
problems involving Malaya, Singapore, and British Borneo, but which 
appeared in Jakarta's eyes to be a neocolonial plot against the republic 
and its ongoing revolution — Sukarno at first merely meddled and 
then, when the new state was formed in 1963, declared Confrontation 
(see Glossary), or Konfrontasi as it was called in Indonesian, a step 
that led the nation to the brink of war. Confrontation had support from 
both China and the Soviet Union (by then themselves estranged) as 
well as the PKI but was opposed by Britain and the United States, and, 
surreptitiously, by elements* of ABRI. Sukarno was now faced with 
increasing isolation from the Western powers, and the deepening 
unpredictability of interlocking power struggles on both international 
and domestic fronts. This was not the "joining the world" for which 
most nationalists had hoped. 

Years of Crisis 

These tensions had escalated by late 1964, to the point that gov- 
ernment was paralyzed and the nation seethed with fears and rumors 
of an impending explosion. In the countryside, especially in Java and 
Bali, the "unilateral actions" the PKI began a year earlier to force- 
fully redistribute village agricultural lands had resulted in the out- 
break of violence along both religious and economic class lines. 
Especially in Jawa Timur Province, Nahdlatul Ulama mobilized its 
youth wing, known as Ansor (Helpers of Muhammad), and deadly 
fighting began to spread between and within now thoroughly polar- 
ized villages. ABRI increasingly revealed divisions among pro-PKI, 
anti-PKI, and pro-Sukarno officers, some of whom reportedly began 
to involve themselves in rural conflicts. In the big cities, demonstra- 
tions against the West reached fever pitch, spilling over into intellec- 
tual and cultural affairs as poets and artists confronted each other 
with diametrically opposed views on the nature and proper social 
role of the arts. The domestic economic crisis deepened as the price 
of rice soared beyond the means of most urban residents, especially 
those of the middle classes on government salaries, and the black- 
market rate of exchange exceeded the official rate by 2,000 percent. 

Sukarno was furious that the newly formed Malaysia had been 
granted a temporary seat on the United Nations Security Council, and 
on January 1, 1965, he withdrew Indonesia from the UN, and later 
from other world bodies such as the International Monetary Fund 
(IMF) and the World Bank. In April, China announced that it sup- 
ported the idea, proposed earlier by Aidit, of arming a "fifth force" of 
peasants and workers under PKI leadership to balance the power of 
AB Ill's four armed services, and that it could supply 100,000 small 



68 



Historical Setting 



arms for the purpose. Then on August 17, 1965, Sukarno, who two 
weeks earlier had collapsed during a public appearance and was 
thought to be gravely ill, delivered an Independence Day speech, 
which addressed joining a "Jakarta-Phnom Penh-Beijing-Hanoi- 
Pyongyang Axis" and creating an armed fifth force in order to com- 
plete Indonesia's revolution. It seemed to many that the PKI was 
poised to seize power, at the same time that the whole constellation 
of competing forces swirling around Sukarno was about to implode, 
with consequences that could only be guessed. On September 27, the 
army chief of staff, Ahmad Yani (1922-65), who was close to 
Sukarno and shared his anti-neo-imperialist outlook, nevertheless 
informed him that he and Nasution unequivocally refused to accept a 
"fifth force," a stand that brought them in direct opposition to the 
PKI, Sukarno, and even some ABRI officers. Air Force Vice Marshal 
Omar Dhani (1924-2009), for example, had begun to offer paramili- 
tary training to groups of PKI civilians, apparently at Sukarno's urg- 
ing. The balancing act was over. 

The "Coup" and Its Aftermath, 1965-66 

In the early morning hours of October 1, 1965, troops from four 
ABRI companies, including one from the Cakrabirawa Presidential 
Guard, deployed in air force motor vehicles through the streets of 
Jakarta to the homes of Nasution, Yani, and five other generals 
known to be opposed to the PKI. Three were killed resisting capture, 
and three were later murdered at the nearby Halim Perdanakusuma 
Military Air Base, where, it was later learned, their bodies were 
thrown into an abandoned well in an area known as Lubang Buaya 
(Crocodile Hole). The remaining general, then-Minister of Defense 
Nasution, narrowly escaped, but his adjutant was captured instead 
and also murdered at Lubang Buaya, and Nasution's daughter was 
injured in the intrusion and later died. Not long thereafter, Jakartans 
awoke to a radio announcement that the September 30 Movement 
(Gerakan September Tiga Puluh, later referred to by the acronym 
Gestapu by opponents) had acted to protect Sukarno and the nation 
from corrupt military officers, members of a Council of Generals 
that secretly planned, with U.S. Central Intelligence Agency (CIA) 
help, to take over the government. The announcement stressed that 
the action was an internal ABRI affair. At noon a Decree No. 1 was 
broadcast, announcing the formation of a Revolutionary Council as 
the source of all authority in the Republic of Indonesia. 

Faced with the news of this apparent coup attempt, the com- 
mander of the Army Strategic Reserve Command (Kostrad), General 
Suharto (1921-2008), who had not been on the list of those to be 



69 



Indonesia: A Country Study 

captured, moved swiftly, and, less than 24 hours after events began, 
a radio broadcast announced that Suharto had taken temporary lead- 
ership of ABRI, controlled central Jakarta, and would crush what he 
described as a counterrevolutionary movement that had kidnapped 
six generals of the republic. (Their bodies were not discovered until 
October 3.) When the communist daily Harian Rakjat published an 
editorial supportive of the Revolutionary Council on October 2, 
1965, it was already too late. In Jakarta, the coup attempt had been 
broken, and anti-PKI, anti-Sukarno commanders of ABRI were in 
charge. Within a few days, the same was true of the few areas out- 
side of the capital where Gestapu had raised its head. 

These momentous events, which triggered not only a regime 
change but also the destruction of the largest communist party out- 
side the Soviet Union and China, hundreds of thousands of deaths, 
and a generation of military rule in what was then the world's fifth 
(now fourth) most populous country, have long eluded satisfactory 
explanation by scholars. Debate over many points, both in and out- 
side of Indonesia, continues to be stubborn, polarized, and domi- 
nated by intricate and often improbable tales of intrigue. The 
circumstances and available data are such that a wide variety of 
explanations are equally plausible. Scholarly opinion has been espe- 
cially skeptical of the conclusion drawn almost immediately by 
Suharto (and later the government he headed) and the CIA, that the 
PKI was to blame for Gestapu. Experts have offered numerous sce- 
narios instead, suggesting that the (anti-PKI) military, and perhaps 
even Suharto himself, were in fact the real masterminds. 

More recently, however, a view that has gained credence (origi- 
nally posited in an early CIA report and raised by captured PKI lead- 
ers) is that Gestapu was in fact the result of highly secret planning — 
secret even within the PKI leadership structure — by party head D. N. 
Aidit and his close friend since pemuda days in 1945, "Syam" 
Kamaruzaman (ca. 1924-86), head of the party's supersecret Special 
Bureau. For reasons that are not entirely clear but were probably 
connected with Aidit 's fears that Sukarno was near death and that 
without his protection the party could not survive, Syam was given 
responsibility for constructing a plot to neutralize army opposition. It 
is generally acknowledged that the plans were ill-conceived and so 
poorly executed that investigators often found comparatively simple 
errors unbelievable, taking them instead as clues to hidden conspira- 
cies. The movement collapsed almost instantaneously, more from its 
own weaknesses than as a result of any brilliance or preparation that 
might be ascribed to Suharto's response. 

Whether or not the Aidit-Syam thesis is accepted, there remains 
the very important question of who, or what factors, should bear 



70 



Historical Setting 



responsibility for the mass killings that took place, mostly between 
October 1965 and March 1966 and then in occasional outbursts for 
several years thereafter. Although there are no satisfactory data on 
which reliable national calculations can be made, and Indonesian 
government estimates have varied from 78,500 to 1 million killed, a 
figure of approximately 500,000 deaths was accepted in the mid- 
1970s by the head of the Operational Command for the Restoration 
of Security and Order (Kopkamtib) and is widely used in Western 
sources. As many as 250,000 persons may have been imprisoned as 
well. As to who carried out these killings, the available evidence is 
meager and mostly anecdotal and suggests a complex picture. In 
some areas, clearly Muslim (in central and eastern Java, predomi- 
nantly Nahdlatul Ulama) vigilantes began the murders spontane- 
ously and, in a few places, even had to be reined in by army units. In 
others, army contacts either acquiesced to or encouraged such 
actions, and in a number of these there was a clear coordination of 
efforts. In what seems to have been a smaller number of places, army 
units alone were responsible. People participated in the killings, or 
looked the other way, for a wide variety of reasons, personal, com- 
munity-related, and ideological. 

Whatever the case, the mass killings amounted to a cataclysmic 
ideological cleansing in which not only communists but also sus- 
pected communists (and in some areas miscellaneous other per- 
ceived enemies, including Chinese) lost their lives. Violence of this 
type and on this scale, although perhaps foretold in episodes of the 
National Revolution, was new to Indonesia. It is perhaps true, as his- 
torian Robert B. Cribb has suggested, that after the disillusionment 
of the struggle for independence, and the deprivations and hostilities 
of Guided Democracy, Indonesians were "ready for a culprit," but 
the fury unleashed seems too intense and too broad to be explained 
in this way alone. Similar questions about the origins of extreme vio- 
lence in Indonesia were to arise a generation later, at the end of the 
regime that in 1965-66 was just beginning to take hold. 

The abrupt narrative break of the violent events that immediately 
followed Gestapu gives the impression that the transition from the 
Old Order to the New Order (as they came to be called, first by anti- 
PKI, anti- Sukarno student protesters) was swift. In reality, Sukarno's 
power and Guided Democracy policies dissolved more slowly, 
despite fierce opposition in some circles to his continued defense of 
the PKI and his refusal to concede that Guided Democracy had 
failed. Suharto and his supporters were aware that Sukarno contin- 
ued to have loyal followers, and they did not wish to risk more 
upheaval, much less a backlash against the army. Military tribunals 
began holding well-managed trials of PKI figures, and a gradual 



71 



Indonesia: A Country Study 

removal began of ABRI officers and troops thought to be strong PKJ 
or Sukarno loyalists. 

In early 1966, Sukarno, still the acknowledged president, was 
pressured into signing the Letter of Instruction of March 1 1 (Surat 
Perintah Sebelas Maret, later known by the acronym Supersemar — 
see Glossary), turning over to Suharto his executive authority, for 
among other reasons, to keep law and order and to safeguard the 
Revolution. The next day, the PKI was officially banned and its sur- 
viving leaders, as well as prominent pro-Sukarno figures, arrested 
and imprisoned. Over the next few months, the new government 
largely dismantled Sukarno's foreign policy as Jakarta broke its ties 
with Beijing, abandoned confrontation with Malaysia, rejoined the 
UN and other international bodies, and made overtures to the West, 
especially for economic assistance. The Inter-Governmental Group 
on Indonesia (IGGI — see Glossary) was formed to coordinate this 
aid. In mid- 1966, the Provisional People's Consultative Assembly 
(MPR(S)) demanded that Sukarno account for his behavior regard- 
ing Gestapu, but he stubbornly refused; only early the next year did 
he directly claim that he had known nothing in advance of those 
events. But by then, even many of his supporters had lost patience. 
On March 12, 1967, the MPR(S) formally removed Sukarno from 
power and appointed Suharto acting president in his stead. The New 
Order thus officially began as the Old Order withered away. Alone 
and bitter, Sukarno lived under virtual house arrest in the presiden- 
tial palace in Bogor, Jawa Barat Province, until his death in 1970, 
and he was buried far from the nation's capital in his home town of 
Blitar in Jawa Timur Province. 

Contemporary Indonesia 

Rise of the New Order, 1966-85 

On the surface, and particularly through a Cold War lens, the New 
Order appeared to be the antithesis of the Old Order: anticommunist 
as opposed to communist-leaning, pro-Western as opposed to anti- 
Western, precapitalist rather than anticapitalist, and so on. As new 
head of state, Suharto seemed to reflect these differences by being, 
as historian Theodore Friend put it, "cold and reclusive where 
Sukarno had been hot and expansive." And certainly many Indone- 
sians saw the change of regime as representing a great deal more 
than a mere shift or transition. Separated from the Old Order by a 
national trauma, the New Order was unabashedly dominated by the 
military, focused on economic development (pembangunan), and 
determined to create stability. The promoters of the New Order saw 



72 



Historical Setting 



themselves as pragmatic and realistic, generally apolitical and 
opposed to all ideologies, characteristics that, in the wake of the 
Guided Democracy years, were by no means unpopular even among 
those who were nervous about the prospects of military rule. 

It became obvious in time, however, that alongside the differences 
there were a number of important similarities between the two 
regimes. For example, both Sukarno and Suharto developed into 
authoritarian rulers, compared by critics to ancient Javanese kings 
and seen as unique and uniquely potent figures — the sole dalang 
(puppet master) — on whom everything depended. Both men believed 
in a strong, highly centralized, and religiously neutral state, and both 
found established political parties and organized public opposition 
difficult to tolerate. Both searched for and hoped to define an appro- 
priate national identity, looking back to Indonesia's beginnings as an 
independent nation for inspiration in so doing. Both men overesti- 
mated their own powers and were in the end forced from office and 
publicly disgraced in ways and for reasons they could not grasp. The 
two "orders," like the two individuals who epitomized them, are best 
viewed not in either/or terms, but in the light of nuance and an aware- 
ness of similarities and differences, changes and continuities. 

It was still far from clear in 1966, either to Suharto himself or to 
his civilian and military supporters, what the New Order was actually 
going to look like. At a seminar entitled "In Search of a New Path" 
held at Jakarta's Universitas Indonesia in May that year, students and 
intellectuals grappled primarily with problems associated with the 
economy, focusing on the role that could be played by those with spe- 
cialized training in economic development and finance, so-called 
technocrats. Three months later, the armed forces, under Suharto's 
leadership, held their own seminar in Bandung, entitled "Broad Pol- 
icy Outlines and Implementation Plans for Political and Economic 
Stability." There was extended discussion, with civilian leaders in 
attendance, of the appropriate role of the military in rebuilding Indo- 
nesia. They settled on "safeguarding the Revolution," and exercising 
dwifungsi (dual function) of national defense and participation in the 
nation's political and social affairs, twin responsibilities said to be 
rooted in the army's experience during the struggle for independence 
(see Suharto's New Order, 1965-98, ch. 5). 

There were vague references at this time to elections, but it was rea- 
sonably clear that there would be no return to the open party politics of 
the early 1950s, which military, and many civilian, leaders considered 
divisive because they either tapped into "primordial" loyalties and 
identities or created such loyalties on the basis of inappropriate ideolo- 
gies. On the other hand, Sukarno's Guided Democracy had proven 



73 



Indonesia: A Country Study 

unworkable. The New Order solution was to attempt an apolitical, 
nonideological, quasi- or pseudo-democratic system that would pro- 
mote unity, prevent both internal conflict and the obstruction of eco- 
nomic development, and satisfy some of the basic requirements of 
world opinion. 

Political Structure 

What came to be called Pancasila Democracy appears to have 
been constructed principally by Ali Murtopo (1924-84), a long-time 
army associate of Suharto. Of modest social and educational back- 
ground, Ali Murtopo rose to prominence in the military, primarily as 
an "operator" with strategic sense and a "can do" attitude. His role as 
a leading military intelligence officer earned him a reputation as an 
unscrupulous and rather mysterious manipulator, but in some 
respects he mirrored views held far beyond a small group of military 
leaders and shared among the civilian middle classes, and his activi- 
ties were widely known. His plan had three key elements. First, gov- 
ernment control of the parliamentary process would be achieved by 
stipulating that a certain percentage of the membership of the chief 
legislative body, the People's Representative Council (DPR), and the 
chief representative body, the People's Consultative Assembly 
(MPR), were to be government civilian appointees, with an addi- 
tional group of appointed members from the armed forces. Second, 
control of the electoral process would come by limiting the number 
of political parties and prying them away from ethnic, religious, 
regional, or personal identities, as well as by establishing a govern- 
ment-backed parliamentary representative group (pointedly not a 
"political party") of government employees and other groups, such as 
Golkar (see Glossary), an organization of functional groups, to partic- 
ipate in elections. Third, control over the majority of the voting pub- 
lic would result from limiting the periods of political campaigning 
and restricting such activities to the district level. The inhabitants of 
villages and small towns — the majority of Indonesians — were to be 
"freed" from mass political mobilization, manipulation, and polariza- 
tion, becoming instead a more or less depoliticized "floating mass." 
They would be encouraged to vote for whichever party or group they 
thought might best answer their needs at the moment, but not to make 
their choices on the basis of "primordial" or personal identifiers. 

An additional component, designed initially under the direction of 
Ruslan Abdulgani (1914-2005), who had served as Sukarno's chief 
ideological adviser a decade earlier, was a national indoctrination 
program intended to give Pancasila clarity and application, and to 
ensure that all Indonesians uniformly understood and accepted it. The 



74 



Suharto, president of 
Indonesia from 1967 to 1998 
Courtesy Embassy of 
Indonesia, Washington, DC 



military, the extraconstitutional Kopkamtib, and the civilian National 
Intelligence Coordinating Board (Bakin) all exerted degrees of 
watchfulness and enforcement. 

These arrangements, which came to characterize the New Order, did 
not emerge suddenly and fully formed but rather were the product of 
gradual change and, generally, pragmatic adjustment. The consolida- 
tion of political parties, for example, did not take place until 1973, two 
years after the first elections (in which Golkar won nearly 63 percent of 
the vote). Government strategists seem to have thought consolidation 
might be preferable to the direct but clumsy manipulation of party 
leadership attempted before the elections. A strong fear persisted that, 
even with communism outlawed, potential threats to order remained in 
the form of religiously identified parties and the former followers of 
Sukarno. Islamic parties had to combine, for this reason, in a govern- 
ment-created Development Unity Party (PPP), and other parties, 
including Sukarno's old PNI, amalgamated in the Indonesian Democ- 
racy Party (PDI). Where Pancasila was concerned, the government 
attempted to introduce draft bills on the subject in 1969 and 1973, but 
nothing came of them. It was only in 1978 that moral instructions, the 
so-called Guide to Realizing and Experiencing the Pancasila (P4), took 
shape, and Pancasila education began to enter school curricula and 
civil service training in earnest. Not until 1985 did all organizations, 



75 



Indonesia: A Country Study 

including political groups, have to adopt the Pancasila as their asas 
tunggal (underlying principle). 

Particularly after its first decade and down until its final years, the 
New Order's political design gave the impression that it had produced 
a tight, highly centralized, and closely managed system, and one that 
depended to an extraordinary degree on the political genius of one 
individual, Suharto. Scholars and others, especially those who opposed 
the rise of the New Order, struggled to find an appropriate term with 
which to describe it — autocratic, militarist, neofeudal, patrimonial, 
paternalist, neofascist, corporatist, military-bureaucratic, developmen- 
talist, or command-pragmatist — and periodically announced that its 
demise was imminent. None of the terms proved altogether satisfac- 
tory, but even so the New Order lasted for 32 years. 

The continuity of the New Order was not achieved solely, or per- 
haps even largely, by force or the threat of force. For one thing, Indo- 
nesia was far too large and too diverse to be ruled entirely uniformly 
by a single institution, much less a single person. As political scien- 
tist Donald K. Emmerson noted in 1999, '"Suharto's Indonesia' had 
never been more than a metaphor." Further, the military itself was 
neither monolithic nor a caste apart from civilian society. The actual 
practice of dwifungsi, which by 1969 had, for example, placed mili- 
tary men as governors in nearly 70 percent of the nation's provinces 
and as mayors and district heads in more than half of all cities and 
districts, did more to "civilianize" the military than to militarize civil 
society. And it was under "military rule" that the civilian bureau- 
cracy ballooned, between 1975 and 1988 more than doubling to 3.5 
million. It is also true that the New Order was founded, and contin- 
ued to depend upon, a rough and largely unspoken consensus among 
the middle classes, military as well as civilian, that economic devel- 
opment came before everything else. The New Order government 
had a great deal of leeway as long as it could make good on promises 
of economic growth. 

None of this meant, however, that government policies and actions 
went unopposed. Indeed, the period of greatest political structural 
change and economic expansion saw serious outbursts of dissent: the 
1974 Malari riots over big business and the burgeoning Japanese eco- 
nomic presence were followed in 1 976 by the Sawito Affair accusing 
Suharto and the government of corruption. In 1980 came the Petition 
of 50 in which notables, many of them former ABRI officers and 
close allies of Suharto, protested that the New Order had misinter- 
preted Pancasila and misunderstood the proper mission of the armed 
services, and in 1984 the Tanjung Priok riots protested corruption and 
ABRI's handling of Islam. These upheavals were handled in coarse, 
often coercive, ways. But they could be weathered because a broad 



76 



Historical Setting 



public feared unrest and had made a certain peace with the supposi- 
tion, long nursed in both military and some civilian circles, that 
potential enemies to national order included not only communism and 
Islam but also unfettered Western-style liberal democracy. 

Economic Growth 

The New Order's primary goal and justification was rapid economic 
growth, to be achieved not by a thorough-going reversal from Guided 
Democracy's state-centered socialist ideals to liberal capitalism, but by 
finding a realistic, flexible way to deliver results without entirely aban- 
doning those ideals. This was a formidable task. Economic historian 
Pierre van der Eng has estimated that at the start of the New Order, 
Indonesia's per capita GDP was below what it had been in 1940, and 
probably below the level of 1913. The country was also saddled with 
an enormous foreign debt and crippling inflation (see The Role of 
Government, ch. 3). The strategy drawn up and managed by a team of 
Western-educated economists headed by Wijoyo Nitisastro (1927— 
2005) was ambitious but fiscally cautious and uninterested in eco- 
nomic nationalism or dogma. Beginning in 1969, Repelita (see Glos- 
sary) — five-year plans that were really more guidelines than economic 
plans — laid out broad priorities but left much room for policy maneu- 
vering and adjustment to changing conditions. The focus was squarely 
on alleviating poverty, and in the simplest terms the approach was to 
improve agricultural productivity and rural incomes. Successes there 
would then provide the dynamic for industrialization, which would in 
turn bring the nation to a point of "takeoff' to full and self-sustaining 
modernization. 

Remarkably, and despite widespread skepticism, the New Order 
did succeed in bringing about a rapid transformation of Indonesia's 
economy. During the roughly 30-year period, for example, Indonesia 
averaged a real GDP growth of roughly 5 percent, and real per capita 
GDP trebled. Average caloric intake increased by 70 percent, aver- 
age life expectancy rose from about 47 to 67 years, and the manufac- 
turing and industrial sectors' combined share of GDP rose from 19 
percent to roughly 65 percent while agriculture's share dropped from 
53 percent to 19 percent. The incidence of poverty dropped from 61 
percent to 10 percent on Java, and from 52 percent to 7 percent else- 
where in the country. In 1993 the World Bank placed Indonesia 
among the highest-performing developing economies and pointed to 
its success in achieving both rapid growth and improved equity. 

This was an astounding performance, and understanding it has 
occasioned heated and continuing academic debate. Some scholars 
point out that Indonesia's accomplishments must be evaluated in a 



77 



Indonesia: A Country Study 

broader, comparative context. Surpassing Nigeria in virtually all 
macroindicators, and India and China in some of them, Indonesia 
nevertheless lagged behind neighboring Malaysia, Thailand, and the 
Philippines in others. Especially considering the point from which it 
began, Indonesia performed remarkably well, but on a world scale in 
a long generation of economic improvement, it is important to iden- 
tify both comparative strengths (sustained growth rate, structural 
change) and weaknesses (inflation, terms of trade, and debt service). 

Other writers have questioned the accuracy of the statistical data 
used to support many of the findings about New Order economic 
development, suggesting among other things that the ways poverty 
was measured were flawed and that methods of gauging inequality 
simply did not match up with either observation or public commen- 
tary. Between the early 1970s and the mid-1990s, for example, there 
was a common assumption that the gap between rich and poor in 
Indonesia grew fairly rapidly, although during the same period the 
nation's Gini index (see Glossary), based on household expenditure, 
remained relatively steady at about 0.34, well below Thailand (0.45), 
the Philippines (0.48), and Malaysia (0.50). It seems likely, however, 
that the divergence is best explained not by flawed methods of mea- 
surement, but by changing perceptions. New Order Indonesians 
were the first to acquire wealth in significant numbers, and to a 
vastly better-informed society with rising expectations it appeared 
that the rich were getting richer and the poor poorer even though this 
was not statistically the case. 

Some critics have also characterized Indonesia's economic prog- 
ress during the New Order as ephemeral because it was dependent on 
foreign aid, state investment (and control), and/or the exploitation of 
nonrenewable resources, especially oil and gas. Such arguments are 
difficult to support with real data. Oil revenues, for instance, supplied 
much of Indonesia's budgetary income during the boom years 
between 1973 and 1981, but agriculture did so before that time, and 
by the end of the New Order, non-oil revenues, bolstered largely by 
industrial and manufacturing growth, accounted for nearly 70 percent 
of the budget. Oil and oil prices did not determine growth throughout 
the period, and the New Order is widely credited among economists 
for managing the oil windfall more wisely than other newly oil-rich 
nations, such as Nigeria and Venezuela, in order to head off depen- 
dency on that source. 

Economic development during the New Order was more than a 
mere facade or, as one of Indonesia's most prominent public intellec- 
tuals, Gunawan Mohammad, once characterized it, an "epic illusion." 
The gains were real and widely shared, and there can be no doubt that 
the average Indonesian was economically better off toward the end of 



78 



Historical Setting 



the New Order than at its start. (Nor were these gains entirely erased 
by the economic crisis of the late 1990s, as some predicted.) Several 
problems, however, rooted as much in the development program's 
successes as in its failures, were of great long-term significance. The 
most obvious was corruption, the scale of which burgeoned as the 
economy grew. A notorious harbinger of things to come was the fis- 
cal scandal surrounding Colonel Ibnu Sutowo (1914-2001), head of 
the State Oil and Natural Gas Mining Company (Pertamina), who by 
1975 had sunk the corporation into enormous international debt while 
personally enjoying a luxurious lifestyle that reportedly included a 
US$1 million wedding for his daughter. By the early 1990s, the finan- 
cial dealings of Suharto's own children, particularly his eldest daugh- 
ter, Siti Hardiyanti Rukmana, better known as Tutut (born 1949), and 
youngest son, Hutomo Mandala Putra, nicknamed Tommy (born 
1962), attracted widespread attention because of their scale and their 
family conglomerates' dependence on privilege. And, well beyond 
financial circles, corruption extended far into the bureaucracy, the 
courts, and the police. Despite numerous campaigns proposing to 
deal with corruption in various corners of society, government task 
forces and investigations made little headway; corruption ate corro- 
sively at the New Order from the inside. 

Other difficulties were less straightforward. For example, New 
Order technocrats had sought to address the economic imbalance 
between Java and the Outer Islands, whose natural resources had 
contributed disproportionately to the national income, a source of 
rebellion in the 1950s and early 1960s. New Order industrialization 
policies, depending heavily on the relatively cheap labor available in 
densely populated Java, changed this. By the mid-1990s, Java pro- 
duced 40 percent of the country's exports, double the figure of only a 
decade earlier and, for the first time since independence, contributed 
a portion of the national economic output — roughly 60 percent — 
equivalent to its share of the population. But this shift produced its 
own imbalance as the economy of the Outer Islands slipped compar- 
atively and some regions began to see widening poverty, a new 
source of heightened tension between the regions and Jakarta. A 
similar irony can be seen in the changing role of the private sector of 
the economy, a goal sanctioned by the New Order government and 
pushed especially hard by the IMF and World Bank. During the first 
four Repelita (1969-88), private investment, foreign as well as 
domestic, provided a very modest percentage of national investment 
funding, but by the end of Repelita V in 1993, it made up more than 
70 percent of the total, a rapid shift. The change was particularly sig- 
nificant, however, because it went unaccompanied by appropriate 
reforms in fiscal regulation. The economy became increasingly 



79 



Indonesia: A Country Study 

driven by the market, and, among other things, private entrepreneurs 
began to make decisions not always in the best interests of the 
national economy, for example by greatly increasing risky borrow- 
ing from overseas sources and from loosely regulated domestic 
banks, factors that contributed in a major way to the economic crisis 
of 1997-98. 

Challenges to the State 

Underlying these New Order initiatives for political and eco- 
nomic change was an important but largely undiscussed continuity 
in some fundamental ideas about the nature of both the nation and 
the state. Consistent with the ideas of the founders of independent 
Indonesia, New Order architects viewed the state as necessarily uni- 
tary and powerful, having little patience with notions of federalism 
or decentralization of powers. Indeed, civilian and military leaders 
alike appear to have assumed that only this highly centric form of 
state authority could bring about the political stability and economic 
growth they sought. The same leaders also inherited assumptions 
about the extent and unity of a national territory generally accepted 
as comprising the former Netherlands East Indies and did not find 
other suggestions tolerable. 

These convictions led among other things to raising an enlarged, 
more centralized bureaucratic structure for the New Order state, and 
requiring administrative authorities to apply centrally developed pol- 
icies on matters ranging from taxes to traditional performances, edu- 
cation to elections, firmly and uniformly throughout the nation. Seen 
from the government perspective, the effort represented a rational, 
modern approach, while to critics it often appeared narrow, oppres- 
sive, and self-serving. Resentment and debate, as well as legal and 
physical struggles, over such issues were a regular feature of life 
under New Order governance. 

Inherited sensitivity to potential challenges to national unity also 
led to military involvement — and long-term enmities — in several 
corners of the archipelago. The first of these took place in West New 
Guinea (later called Irian Jaya, now the provinces of Papua and 
Papua Barat). During the 1949 Round Table Conference, the Dutch 
had refused to discuss the status of this territory, which, upon recog- 
nition of Indonesian independence, was still unresolved. Conflict 
over the issue escalated during the early 1960s, as the Dutch pre- 
pared to declare a separate state, and Sukarno responded with a mili- 
tary campaign. In August 1962, the Dutch were pressed by world 
opinion to turn over West New Guinea to the UN, which permitted 
Indonesia to administer the territory for a five-year period until an 



80 



Historical Setting 



unspecified "Act of Free Choice" could be held (see Local Govern- 
ment, ch. 4). 

Thus it fell to the New Order to complete a project begun by the 
Old Order. Ali Murtopo — with the military support of troops com- 
manded by Sarwo Edhie Wibowo (1927-89) — arranged the cam- 
paign that, in mid- 1969, produced a consensus among more than 
1,000 designated local leaders in favor of integration with the Indo- 
nesian state. This decision was soon approved by the UN, and the 
territory became Indonesia's twenty-sixth province before the end of 
the year. 

The integration process did not go unopposed, however. Initial 
bitterness came from Papuans who had stood to benefit from a 
Dutch-sponsored independence and who formed the Free Papua 
Organization (OPM) in 1965. But resentment soon spread because of 
Jakarta's placement of thousands of troops and officials in the terri- 
tory, exploitation of natural resources (for example, by signing con- 
tracts for mining rights with the U.S. corporation Freeport- 
McMoRan Copper and Gold in 1967), encouragement of settlers 
from Java and elsewhere, and interference with local traditions such 
as dress and religious beliefs. OPM leaders declared Papua's seces- 
sion in 1971 and began a guerrilla resistance. Despite internal splits, 
OPM resistance continued throughout the New Order era, peaking in 
the mid-1980s and again in the mid-1990s, attracting a significant 
ABRI presence. 

In Aceh, northern Sumatra, resistance to Jakarta's extension of 
authority arose in the mid-1970s. This area, known for its 30-year 
struggle against Dutch rule in the nineteenth century, had also found 
it necessary to fight for its autonomy after independence, in a move- 
ment led by the Muslim political figure Muhammad Daud Beureueh 
(1899-1987) and affiliated with Darul Islam. Aceh won status as a 
separate province in 1957 and as a semiautonomous special territory 
with greater local control of religious matters in 1959. In the early 
1970s, however, the discovery of natural gas in Lhokseumawe, 
Aceh, and the fact that this location could be more readily developed 
than other deposits found in eastern Kalimantan and the Natuna 
Islands, meant that for Jakarta Acehnese autonomy was now less tol- 
erable. By 1976 armed resistance to the central government began 
under the banner of a Free Aceh Movement (GAM), led by Hasan di 
Tiro (1925-2010), a former Darul Islam leader who claimed descent 
from a hero of the 1873-1903 Aceh war against the Dutch. Jakarta 
responded with limited military force that crushed the small move- 
ment, but a decade later, when GAM reappeared with greater local 
support and funding from Libya and Iran, both the movement and 
the Jakarta response were far more extensive and brutal: estimates 



81 



Indonesia: A Country Study 

were of between 2,000 and 10,000 deaths, mostly civilian. In the 
mid-1990s, Jakarta claimed to have defeated GAM's guerrilla 
forces, but resentment ran deep, and thousands of government troops 
remained posted in Aceh. 

The military involvement of greatest significance during the New 
Order, however, was that in East Timor. The status of this small 
imperial remnant changed when a radically new, democratic govern- 
ment came to power in Lisbon in 1974, and Portugal soon decided to 
shed its colonial holdings. Local political parties quickly formed in 
favor of different visions of the future, the most prominent being the 
leftist Revolutionary Front for an Independent East Timor (Freti- 
lin — see Glossary) and the Timorese Popular Democratic Associa- 
tion (Apodeti), which sought integration with Indonesia as a semi- 
autonomous province. By mid- 1975, it appeared that Fretilin would 
be the likely winner in an upcoming general election, a prospect that 
brought internal political violence as well as escalating concern in 
Jakarta that a "communist" government (a designation generally 
considered inaccurate) might plant itself in the midst of the Indone- 
sian nation. On November 28, 1975, Fretilin announced the indepen- 
dence of the Democratic Republic of East Timor (as of 2002, the 
Democratic Republic of Timor-Leste), which it controlled. Driven 
by ideological fears rather than a desire for national expansion, 
Jakarta reversed its earlier avowed policy of noninterference and, 
with the implicit consent of Australia and the United States, on 
December 7 launched an assault on East Timor and soon began a 
brutal "pacification" requiring more than 30,000 ABRI troops. On 
July 15, 1976, East Timor, as Timor Timur, became the twenty-sev- 
enth province of Indonesia, and Jakarta began both exploiting the 
limited natural resources — coffee, sandalwood, marble, and pros- 
pects for vanilla and oil — and undertaking rebuilding and develop- 
ment programs. 

In the late 1980s, the province opened to foreign observers, and in 
1990 ABRI finally captured the charismatic Fretilin leader Jose 
Alexandre "Xanana" Gusmao (born 1946), but widespread resent- 
ment of the occupation festered. Then, in November 1991, Indone- 
sian soldiers fired on a crowd of demonstrators at the Santa Cruz 
Cemetery in Dili, the capital, and dramatic video footage of this 
event, in which between 50 and 250 civilians were killed, was dis- 
tributed worldwide. The majority of Indonesians knew and cared lit- 
tle about East Timor and had not basically disagreed with New Order 
policies there, but the outside world felt very differently. Indonesia 
found itself increasingly pressured — for example, by the United 
States, the European Union (EU), the Roman Catholic Church, and 
the UN — to change course. Indonesia resisted, and, indeed, military 



82 



Historical Setting 



pressures in East Timor tightened, and Muslim migration, especially 
from Java, increased rapidly in this largely Catholic and animist 
area. Not surprisingly, indigenous opposition increased, especially 
among a younger generation born in the 1970s. Jakarta did not rec- 
ognize this response as either legitimate protest or nascent national- 
ism, which it had unwittingly done much to foster. 

Decline and Fall of the New Order, 1985-98 

The New Order probably reached the peak of its powers in the 
mid- to late 1980s. The clear success of its agricultural strategy, 
achieving self-sufficiency in rice in 1985, and its policies in such dif- 
ficult fields as family planning — Indonesia's birthrate dropped 
exceptionally rapidly from 5.5 percent to 3.3 percent annually 
between 1967 and 1987 — earned it international admiration. Eco- 
nomic progress for the middle and lower classes had seemed to bal- 
ance any domestic discontent. In retrospect, however, signs of 
serious weakness were discernible by about the same time. Although 
there had always been a certain level of public and private dissension 
under New Order rule, by the early 1 990s it had grown stronger, and 
the government appeared increasingly unable to finesse this opposi- 
tion with force (veiled or otherwise) or cooptation. In addition, 
intense international disapproval, particularly over East Timor, 
proved increasingly difficult to deflect. 

Several important shifts had taken place, which in turn altered the 
New Order in fundamental ways. One was international: the collapse 
of the Soviet Union in 1991 and the end of the Cold War both pro- 
vided New Order leaders with frightening examples of political 
upheaval and religious and ethnic conflict following in the wake of a 
relaxation of centralized power, and these events also left Indonesia 
more vulnerable to pressures from the West. An important result was 
a new uncertainty in domestic policy, for example, toward public crit- 
icism, Islam, and ethnic and religious conflict. In the military, opin- 
ions grew more varied, many of them frankly disapproving of certain 
government policies, including those toward the armed services. A 
second important change took place as the advice of "technocrats" 
responsible for the successfully cautious economic strategizing of the 
1970s and 1980s began to give way to that of "technicians" such as 
Suharto protege Bacharuddin J. (B. J.) Habibie (born 1936), who 
became a technology czar favoring huge, risky expenditures in high- 
technology research and production, for example by attempting to 
construct an indigenous aeronautics industry. 

Some observers detected a third area of change in the attitude of 
Suharto himself. He grew more fearful of opposition and less tolerant 



83 



Indonesia: A Country Study 

of criticism, careless in regard to the multiplying financial excesses 
of associates and his own children, and increasingly insensitive to 
pressures to arrange a peaceful transition of power to new leadership. 
And, by the late 1990s, he seemed to lose the sense of propriety he 
had professed earlier. Circumventing all normal procedures, Suharto 
had himself appointed a five-star general, a rank previously accorded 
only the great revolutionary leader Sudirman (1916-50) and his suc- 
cessor, Nasution. Further, he not only ignored his own earlier advice 
against running for a seventh term but also placed daughter Tutut, 
son-in-law General Prabowd Subianto (born 1952, and married at the 
time to Suharto's second daughter, Siti Hediati Hariyadi — known as 
Titiek, born 1959), and a host of individuals close to the family in 
important civilian and military positions. These and other transgres- 
sions lost Suharto and many of those around him the trust of even his 
most loyal supporters, civilian as well as military. 

The changes of greatest long-term significance, however, may 
have been social and cultural. New Order architects had planned on 
controlling the nation's politics and transforming its economy, but 
they had given comparatively little consideration to how, if they suc- 
ceeded, society — their own generation's and their children's — might 
change as a result. If economic improvement expanded the middle 
classes and produced an improved standard of living, for example, 
would these Indonesians begin to acquire new outlooks and expecta- 
tions, new values? What might be the cultural results of much 
greater openness to the outside, especially the Western, world? 
Although the New Order became infamous for efforts to inculcate a 
conservative, nationalist Pancasila social ideology, and to promote a 
homogenized, vaguely national culture, these endeavors were far 
from successful. Despite a penchant for banning the works of those 
considered to be influenced by communism (author Pramudya 
Ananta Tur became the world-famous example) and an undisguised 
distaste for "low," popular culture (a high government official once 
disparaged dangdut, a new and wildly popular music style blending 
modern Western, Indian, Islamic, and indigenous influences, as 
"dog-shit" music), the New Order's leaders turned a comparatively 
blind eye to cultural developments and seemingly had little idea 
what such changes might reflect of shifting social values. 

Indonesianist Barbara Hatley has pointed to "a vigorous process 
of reinterpretation" of tradition during the New Order period, as well 
as new reflections of the present. For example, in a series of four 
novels about the lives of young, urban, middle-class Indonesians in 
the late 1970s and early 1980s, Yudhistira Ardhi Nugraha (born 
1954) satirized the world of their pompous, hypocritical parents, 



84 



Historical Setting 



civilian as well as military. Playwright Nobertus "Nano" Riantiarno 
(born 1949) used mocking language and absurdist humor to make 
fun of the world of politicians and government bureaucrats in his 
1985 Cockroach Opera, which was finally banned five years later. 
By the late 1980s, many of the older generation had begun to ques- 
tion the implicit bargain they had struck with the New Order; their 
children, who had little or no memory of the Sukarno period or the 
dark days of the mid-1960s, merely saw the limitations and injus- 
tices around them and resisted, often with humor and cynicism. 

More openly and widely challenged than ever before, the New 
Order was in 1997 confronted with economic collapse in the wake of 
a wider Asian financial crisis. The government's response was slow 
and inadequate, pleasing neither liberals nor nationalist conserva- 
tives. Over an eight-month period, the value of the rupiah (see Glos- 
sary) fell 70 percent. Over the course of a year, the economy as a 
whole shrank nearly 14 percent, 40 percent of the nation's businesses 
went bankrupt, per capita income fell an estimated 40 percent, and 
the number of people living in poverty catapulted, by some accounts, 
to as much as 40 percent of the population. By March 1998, when 
Suharto and his chosen running mate, Habibie, became president and 
vice president, respectively, it was clear that a line had been crossed. 
Public calls for reform turned angry, and within weeks bitterly anti- 
government, anti-Suharto student demonstrations spilled out of cam- 
puses across the nation. On May 12, at Trisakti University in Jakarta, 
members of the police force, then under ABRI command, fired on 
demonstrating students, killing four (and two bystanders) and 
wounding at least 20 others. This event, which created instant mar- 
tyrs and removed any lingering hesitancy for a broad spectrum of 
Indonesians, launched several days of horrific violence, which ABRI 
could not or would not control. In Indonesia as a whole, an estimated 
2,400 people are said to have died; as much as US$1 billion in prop- 
erty was damaged; and tens of thousands of foreign residents and 
Indonesian Chinese fled the country. The government that had come 
to power promising stability and economic growth now demonstra- 
bly could deliver neither, and its leader was precipitously abandoned 
by even his closest associates. In a simple ceremony held on May 21 
at 9:00 a.m., Suharto resigned, bringing a symbolic end to the now 
jaded and discredited New Order leadership. 

Reformasi and the Post-New Order Era, 1998-2009 

Suharto's departure, however, brought neither relief nor calm to 
Indonesia, instead ushering in an extended period of upheaval and 
escalating violence. This took many forms — interethnic, interreligious, 



85 



Indonesia: A Country Study 

political, both neighborhood and military-organized vigilantism, and 
even bizarre mob attacks on "ninjas" and sorcerers — and was spread 
throughout the country, most notably in Kalimantan, Maluku, central 
Sulawesi, and eastern Java. Everywhere sensational examples of sav- 
agery were recorded in the media: piles of human heads in Kaliman- 
tan, suspected sorcerers dragged through the streets by motorcycles in 
eastern Java, petty thieves beaten and burned alive in many places, and 
killers in Kalimantan and Ambon reportedly drinking their victims' 
blood and eating their organs. As many as 20,000 people may have 
been killed between 1998 and 2001 and more than 200,000 displaced 
from their homes. There was vigorous debate over the causes of the 
violence, and widespread talk of revolution, civil war, and the disinte- 
gration of the nation as it descended into a surreal and barbarous chaos 
(see Violence, Vengeance, and Law, ch. 2). 

These paroxysms did not deter, and remarkably indeed may have 
done much to propel, movement in the direction of dismantling the 
political structure built by the New Order. Even before it began, the 
post-Suharto era had been called a time of reformasi (see Glossary) 
by a broad spectrum of activists, and the name stuck despite uncer- 
tainty over exactly what it might mean. Perhaps the greatest surprise 
in the early days of this reformasi proved to be Habibie, Suharto's 
constitutional successor and by virtually all sides considered politi- 
cally suspect, incompetent, or both. During his brief interim presi- 
dency (May 1998 to October 1999), however, Habibie oversaw the 
start of fundamental change in Indonesia's political and economic 
structure and attempted conciliatory solutions to the conflicts in 
Papua, Aceh, and most notably East Timor, to which he offered the 
option of voting for independence. He reduced many powers of 
ABRI (which was separated from the police in April 1999 and 
became known again as the TNI); began decentralizing civilian gov- 
ernment; and countermanded discriminatory laws aimed at Chinese 
Indonesians (see Political Dynamics, ch. 4). 

None of these fundamental changes was completed without diffi- 
culty. East Timor, for example, passed through an agony of civil con- 
flict and military-backed violence after voting to separate from 
Indonesia in August 1999; independence as Timor-Leste finally came 
in May 2002 after a long and difficult transition under UN auspices. 
Genuine reform measures had been launched, however, and, for the 
most part, the nation responded positively to them. The scheduled 
general elections from June to October 1999 occurred amidst conflict, 
but under the circumstances it was remarkable that they could be held 
at all. In the end, a politically intricate but reasonably peaceful transi- 
tion was made to the presidency of Nahdlatul Ulama leader and 
prominent intellectual figure Abdurrahman Wahid (1940-2009), who 



86 



B. J. Habibie, president of 
Indonesia, 1998-99 
Courtesy Embassy of Indonesia, 
Washington, DC 




maneuvered to have his main opponent, Sukarno's daughter Mega- 
wati Sukarnoputri (born 1948), selected as his vice president. 

During the interelection period 1999-2004, Indonesia seemed in 
danger of losing its way as the pace of reformasi slackened and new 
problems arose. Wahid, known familiarly as Gus Dur, was the dar- 
ling of many liberal Muslims and, particularly, Western Indonesia- 
watchers, many of whom knew him personally and saw him as an 
exponent of liberal democracy, pluralism, openness, and informality, 
the antithesis of everything they had despised about New Order gov- 
ernment. To some degree, he was all those things, but both he and 
those around him proved managerially and politically inept, unable 
to satisfy a diverse following. Many conservative Muslims had 
expected him to further their agenda of an Islamic state, and were 
appalled by Wahid's insistence on religious tolerance and visiting 
Israel. Military leaders were shocked to discover that he intended to 
follow through on plans to hold them accountable for violence the 
armed forces had sponsored in East Timor, and they joined with 
some Muslim politicians in bitter opposition to his effort to open the 
long-silenced trauma of 1965-66 to public scrutiny and reconcilia- 
tion. In July 2001, a special session of the MPR voted Wahid out of 
office and recognized Megawati as his successor. 

This second interim presidency in three years suggested to many 
that, whatever reformasi was going to amount to would be limited 
and slow in coming. Some declared it dead altogether, for not only 
did Megawati lack her father's charisma (which might have been 
harnessed to promote change), she possessed — irony of ironies — 
more of a New Order outlook than many of her supporters suspected, 
and was little inclined to challenge the status quo. She was also 
much influenced by conservative military leaders who argued that 
revived separatist movements of the OPM and GAM could success- 
fully be met with force. Jakarta declared martial law in Aceh and 
deployed 50,000 troops, which predictably only served to alienate 
more Acehnese than ever before. The economy began to recover 
(with an annual growth rate of more than 7 percent), but corruption 



87 



Indonesia: A Country Study 

flourished, and many of the financial practices and business net- 
works continued to operate as before, at least in part because the 
tainted judicial system remained unchanged. 

During this period, however, two fundamental reforms quietly 
took hold. The first was a Decentralization Law that went into effect 
in early January 2001. This sweeping legislation (with some revi- 
sions in 2004) made the Indonesian state system one of the world's 
most decentralized, with budgetary and most other bureaucratic and 
electoral matters being turned over to local authorities down to the 
district level. This dramatic ^change carried risks, as it left plenty of 
room for misuse, but it represented real movement toward transpar- 
ency and away from the accumulation of centralized power. The sec- 
ond important reform, a major overhaul of the nation's constitution 
undertaken in four stages between 1999 and 2002, called for, among 
other things, the direct election of the president and vice president; a 
limitation of the president to two terms in office; free and secret 
elections of regional legislatures and a two-house MPR consisting 
entirely of elected members; establishment of the Constitutional 
Court; and a much expanded delineation of human rights (see The 
Structure of Government, ch. 4). Only slightly more than 10 percent 
of the original constitution of 1945, the cornerstone of New Order 
legal thought, remained unchanged. Together, these developments 
laid the groundwork for a thorough refashioning of the way the Indo- 
nesian state functioned. 

One issue not directly addressed by the reformasi movement con- 
cerned the rise of Islamic politics and, increasingly since 1998, of the 
use of violence by extremist Muslims, some of them seeking to recre- 
ate Indonesia as an Islamic state. The best-known group was Jemaah 
Islamiyah (Congregation of Islam), one of whose founders appears to 
have been the Javanese cleric Abu Bakar Ba'asyir (born 1938), 
believed to have ties to Al Qaeda and other terrorist organizations. 
Between 2000 and 2005, members of Jemaah Islamiyah were respon- 
sible for a number of bombings, the most infamous being the October 
12, 2002, explosions in Bali, which killed 202 people and injured 
more than 300, including many foreign visitors. Attacks in Jakarta 
(2003, 2004, and 2009) and Bali (2005) killed 49 people and wounded 
458, mostly Indonesians (see Terrorism, ch. 5). In part because of what 
was perceived as hype and hatred behind the American "global war on 
terrorism" after the September 11, 2001, attacks in the United States, 
and in part because of a reluctance to criticize fellow Muslims profess- 
ing to act on behalf of their religion, most Indonesians initially refused 
to believe that Islamist terror had come to their nation or that it might 
be of any genuine political importance. Many subscribed to fantastic 
conspiracy theories to explain events, and some public figures, includ- 



88 



Historical Setting 



ing Megawati's vice president, Hamzah Haz (born 1940), attempted to 
make political use of such ideas. As a proliferation of Islamist parties 
jostled for position in the more open political arena, many worried that 
the new democratization might end up benefiting precisely those who, 
intolerant of religious diversity, sought to curtail it. 

The complex electoral contest of 2004, in which more than 145 
million voters cast ballots for tens of thousands of local and national 
candidates and then returned to the polls twice more in the largest 
direct presidential election in world history, was widely viewed as a 
critical test for both reformasi and the future of Islamist politics. 
Although local contests generated some violence, the election pro- 
cess itself went far more smoothly than generally predicted, and the 
results did much to suggest that reformasi had indeed brought Indo- 
nesia to the threshold of a sustainable, moderate, democratic polity, 
the world's third largest. Against all expectations, the presidential 
winner, with 61 percent of the vote, was Susilo Bambang Yud- 
hoyono (born 1949), a retired general who abandoned Suharto after 
the 1998 Trisakti University shootings, later refused then-President 
Wahid's order to declare a state of emergency in order to forestall his 
impeachment, and went on to form the small, independent Democrat 
Party (PD). This victory was part of a pattern suggesting to pollsters 
that, given both chance and choice, Indonesian voters were more 
inclined to vote individualistically than along familiar party or ideo- 
logical lines. The outcome also suggested that in this Muslim-major- 
ity nation, most voters had little real interest in parties or candidates 
that identified themselves primarily with Islamic aims rather than 
national or local goals such as development and reform. Some close 
observers in the West, who only two years earlier had seen a bleak 
sociopolitical future for Indonesia, now gushed about the country's 
transformation with the advent of a robust democracy. 

It soon became clear, however, that after the momentous 2004 elec- 
tions, Indonesia passed into a post-New Order, post-reformasi era, the 
character and direction of which were still uncertain. On the one hand, 
concern that the nation was still very fragile proved in many respects 
unfounded. The new administration was able, with international assis- 
tance, to cope reasonably competently and transparently with the 
December 2004 tsunami, thought to be the most destructive ever 
recorded and responsible in Indonesia alone for at least 166,561 
deaths and 203,817 displaced persons, mostly in Aceh, as well as 
untold devastation. A combination of skill and goodwill also made it 
possible for Jakarta to turn the catastrophe to some good account by 
negotiating a peace settlement with GAM the next year. The new gov- 
ernment also proved itself unexpectedly determined and adept in 
bringing to justice those responsible for various terrorist activities. In 



89 



Indonesia: A Country Study 

November 2008, it proceeded with the execution of the three men 
responsible for the 2002 Bali bombings, who had been held since 
their capture and conviction in 2003. The administration also showed 
it could make difficult economic decisions when it announced dra- 
matic cuts to subsidies on gasoline and cooking fuel in order to save a 
troubled budget; significantly, this move did not result in angry pro- 
tests and demonstrations. And despite a much curtailed presidential 
authority, far more circumscribed military powers, and rapid turnover 
in local governance (between 2004 and 2008, voters removed nearly 
40 percent of all governors, "mayors, and district heads), Indonesians 
showed that they could function in a less authoritarian, less predict- 
able structure than New Order leaders had supposed was necessary. 

Disquieting questions remained, on the other hand, about the role 
of Islam in Indonesian society. The opening of politics in the post- 
New Order era had, along with world developments, served to inten- 
sify and complicate the struggle between radical conservative Islam 
and progressive liberal Islam in Indonesia. This contest has taken 
many different forms and has come to inform a wide and varied dis- 
course throughout the nation. Radical conservative groups have pro- 
liferated. They have used print and electronic media to give voice to 
their ideas and in some areas have been effective in using local elec- 
tions to get approval for instituting the sharia in local government. 
(More than a dozen provinces are said to have considered or adopted 
such laws, but in many cases the laws have either been quickly 
rescinded or gone unenforced.) In a long debate over a so-called por- 
nography law, proposed in 2005 and finally passed in late 2008, rad- 
ical conservative Muslim parties and supporting groups framed their 
arguments in ways to gather support from secularist nationalist 
groups, who found it difficult politically not to support such legisla- 
tion — who could be seen as being "for" pornography? — even though 
it threatened pluralism and had been opposed by a range of human- 
rights and feminist groups. 

It is important to realize that this is not a contest between Muslims 
and non- or merely nominal Muslims, but among Muslims. Some rad- 
ical conservative groups have gone so far as to declare death fatwas 
on their moderate opponents, who in turn have publically denounced 
such acts as "stupid." And radical conservative groups have taken 
very loud public stands against government messages about the plu- 
rality of Islam in Indonesia and against progressive Muslim publica- 
tions, such as a Paramadina Foundation book arguing the values of a 
pluralist understanding of modern Islam (even supporting interfaith 
marriage and inheritance rights). What these disputes will mean for 
the nation is as yet far from obvious. 



90 



Historical Setting 



It can be argued that even the controversies over Islam have been 
carried out very much in the public view (not possible a decade 
before), and neither the nation nor national society has been torn 
apart, as some have feared. In many respects, Indonesian society 
appears to have settled on new and calmer middle ground, relatively 
comfortable with new freedoms and also with the debate and even 
conflicts that come with them (see Islam, ch. 2). On the whole, Indo- 
nesians of the younger generation seem more at ease than their par- 
ents with plurality and individuality, and less in need of old- 
fashioned nationalism, ideological guidance, or state leadership. 
Some of these attitudes are reflected in the enormously popular 2005 
novel Laskar Pelangi (Rainbow Warriors) by Andrea Hirata, who 
refuses to reveal his age but is a child of the New Order era; a film 
version appeared in 2008. Hirata's work is autobiographical and 
traces his childhood and education in a poor Muslim community and 
a run-down Muhammadiyah school on the tin-mining island of Beli- 
tung. It is essentially a personal success story of overcoming pov- 
erty, making the most of schooling under difficult conditions, and 
(we learn in three later volumes) becoming a modern Indonesian 
who is also a citizen of the world. Government, bureaucracy, and 
hierarchy are of little relevance; neither, in the end, are ethnicity, 
gender, and religion. What matters is understanding that all people 
have talent, and that individual determination, education, and the 
bonds of common humanity can develop it. Anyone can succeed, 
and success is not necessarily defined by wealth or power or social 
status. Some commentators have seen this novel as a key to the new 
values of the post-Suharto, post-reformasi generation; others have 
gone much further, suggesting that it shows clearly for the first time 
that Indonesian hopes for the future are, in fact, universal and not 
merely national ones, and that Indonesians, after 65 years of inde- 
pendence, are at last joining the world. 

* * * 

The literature on Indonesian history is quite large, and includes 
materials in many languages. This bibliographic essay mentions only 
works in English. The most satisfactory summaries of Indonesian 
history are Colin Brown's A Short History of Indonesia: The 
Unlikely Nation? and the short but sophisticated chapter by Robert 
B. Cribb, "Nation: Making Indonesia." The basic reference works 
any serious student of Indonesian history will find indispensable are 
Cribb's and Audrey R. Kahin's Historical Dictionary of Indonesia, 
Cribb's Historical Atlas of Indonesia, and the relevant portions of 
Jan M. Pluvier's Historical Atlas of South-East Asia. 



91 



Indonesia: A Country Study 

The most comprehensive guide to pre- and proto-history is still 
Peter Bellwood's Prehistory of the Indo-Malaysian Archipelago, but 
this is a field that changes very rapidly, and the best information is 
contained in articles in specialist journals. The volume Ancient His- 
tory (edited by John N. Miksic) in the Indonesian Heritage Series is 
a wonderful summary and is superbly illustrated. It can be supple- 
mented with the more comprehensive and academic work by Paul 
Michel Munoz, Early Kingdoms of the Indonesian Archipelago and 
the Malay Peninsula. 

For a general guide to the period after 1200, the standard work is 
Merle C. Ricklefs's A History of Modern Indonesia Since c. 1200. A 
detailed guide to the following few centuries is the Early Modern 
History volume, edited by Anthony J. S. Reid, in the Indonesian 
Heritage Series. Reid's Southeast Asia in the Age of Commerce, 
1450-1680 and Charting the Shape of Early Modern Southeast Asia 
contain very helpful information on Indonesia, as well as challeng- 
ing interpretations. Merle C. Ricklefs's works on Java in the seven- 
teenth through nineteenth centuries, beginning with War, Culture, 
and Economy in Java, 1677-1726, set high standards of scholarship 
in that difficult field. 

The literature on Dutch expansion and the Netherlands East Indies 
is extensive. The most comprehensive work on the Cultivation Sys- 
tem is perhaps Robert E. Elson's Village Java under the Cultivation 
System. The 1860 novel Max Havelaar: Or the Coffee Auctions of the 
Dutch Trading Company by Multatuli, penname of Eduard Douwes 
Dekker, is still captivating reading. A History of Modern Indonesia by 
Adrian Vickers begins its coverage with the late nineteenth century, 
and the collection of papers edited by Robert B. Cribb in The Late 
Colonial State in Indonesia is very useful. The subjects of nationalism 
and modernism are woven together in Robert E. Elson's valuable con- 
sideration of The Idea of Indonesia: A History and can also be studied 
through the lens of biography in, among many available works, John 
D. Legge's Sukarno: A Political Biography and Rudolf Mrazek's 
Sjahrir: Politics and Exile in Indonesia. The periods of Japanese 
occupation and revolution are the subject of a great many publica- 
tions, but few attempt a comprehensive view. The essays by Ken'ichi 
Goto in Tensions of Empire: Japan and Southeast Asia in the Colonial 
and Postcolonial World are mostly about Indonesia, and, coupled 
with Remco Raben's volume entitled Representing the Japanese 
Occupation of Indonesia, are good places to begin. Peter Post's The 
Encyclopedia of Indonesia in the Pacific War is a valuable new 
resource on the World War II period. On the years 1945-50, Anthony 
Reid's brief but comprehensive The Indonesian National Revolution, 
1945-1950 is still the best overall treatment. 



92 



Historical Setting 



There is no entirely satisfactory general history covering the 
entire post- 1945 period, beyond the excellent relevant chapters in 
Ricklefs and in Vickers, mentioned above, but Robert B. Cribb and 
Colin Brown's Modern Indonesia. A History Since 1945 packs a 
great deal of information and analysis in a very short book, and The- 
odore Friend's colorful Indonesian Destinies offers an intimate view. 
A number of works illuminate aspects of each of the political periods 
of Liberal Democracy, Guided Democracy, the New Order, and 
reformasi, but none of these periods yet has found a comprehensive 
treatment. 

Scholarly articles in English on various aspects of Indonesian history 
can be found in specialized journals such as Bijdragen tot Taal-, Land- en 
Volkenkunde (Leiden, Netherlands) (http://www.kitlv-journals.nl); Cor- 
nell University's Indonesia (http://cip.comell.edu/Indonesia); Journal of 
Southeast Asian Studies (Singapore) (http://joumals.cambridge.org/ 
action/displayJournal?jid=SEA); and South East Asia Research (Lon- 
don) (http://www.ingentaconnect.com/content/0967-828X). 

There are numerous useful Web sites on various aspects of the 
Indonesian past, many of them in the Dutch and Indonesian lan- 
guages. A well-known English-language site offering a detailed, and 
sometimes annotated chronology (up to 2004) is Charles A. Gimon's 
Sejarah Indonesia: An Online Timeline of Indonesian History (http:// 
www.gimonca.com/sejarah). A useful collection of relevant Web 
sites is maintained by the International Institute of Social History 
(http://www.iisg.nl/w3vlindonesia/). (For further information and 
complete citations, see Bibliography.) 



93 



Chapter 2. The Society and Its Environment 



Papuan pontoon boat 



INDONESIA'S SOCIAL AND GEOGRAPHIC ENVIRONMENT is 
one of the most complex and varied in the world. By one count, at 
least 731 distinct languages and more than 1,100 different dialects are 
spoken in the archipelago. The nation encompasses some 17,508 
islands; the landscape ranges from rain forests and steaming man- 
grove swamps to arid plains and snowcapped mountains. Major 
world religions — Islam, Christianity, Buddhism, and Hinduism — are 
represented, as well as many varieties of animistic practices and 
ancestor worship. Systems of local political authority vary from the 
ornate sultans' courts of central Java to the egalitarian communities 
of hunter-gatherers in the jungles of Kalimantan. A variety of eco- 
nomic patterns also can be found within Indonesia's borders, from 
rudimentary slash-and-burn agriculture to highly sophisticated com- 
puter microchip industries. Some Indonesian communities rely on 
traditional feasting systems and marriage exchange for economic dis- 
tribution, while others act as sophisticated brokers in international 
trading networks operating throughout the world. Indonesians also 
have a variety of living arrangements. Some go home at night to 
extended families living in isolated bamboo longhouses; others return 
to hamlets of tiny houses clustered around a mosque; still others go 
home to nuclear families in urban high-rise apartment complexes. 

There are, however, striking similarities among the nation's diverse 
groups. Besides citizenship in a common nation-state, the single most 
unifying cultural characteristic is a shared linguistic heritage. Almost 
all of the nation's estimated 240 million people speak at least one of 
several Austronesian languages, which, although often not mutually 
intelligible, share many vocabulary items and have similar sentence 
patterns. Most important, an estimated 83 percent of the population 
can speak Bahasa Indonesia (see Glossary), the official national lan- 
guage. Used in government, schools, print and electronic media, and 
multiethnic cities, this Malay-derived language is both an important 
unifying symbol and a vehicle of national integration. 

The national average population density, according to the 2000 cen- 
sus, was 109 persons per square kilometer. However, in 2007 some 50 
percent of Indonesians lived in cities, defined by the government's 
Central Statistical Office (BPS; for this and other acronyms, see table 
A) as areas with population densities greater than 5,000 persons per 
square kilometer or where fewer than 25 percent of households are 
employed in the agricultural sector. The percentage of Indonesians 
who live in rural areas, and who are closely associated with agriculture, 



97 



Indonesia: A Country Study 

stockbreeding, forestry, or fishing, has been declining steadily. For 
example, about 53 percent of the workforce was employed in agricul- 
ture, hunting, forestry, and fishing as recently as the mid-1980s; by 
2005 that figure had decreased to 44 percent. As the Indonesian popu- 
lation has grown, become more educated, and moved increasingly 
toward urban centers, small-scale agriculture and trading have played 
decreasing roles in defining people's lifestyles. The rapid expansion of 
the manufacturing, retail, and service industries has led to ways of liv- 
ing defined more by social, cultural, and economic interests than by 
geographic and environmental forces. 

The mobility, educational achievement, and urbanization of the 
Indonesian population have increased overall since the mid-1990s. 
Indonesians have become increasingly exposed to the variety of their 
nation's cultures through television, the Internet, newspapers, schools, 
and cultural activities. Links to indigenous geographic regions and 
sociocultural heritage have weakened, and the contexts for the expres- 
sion of those links have narrowed. Ethnicity is a means of identifica- 
tion in certain situations but not in others. For example, during 
Ramadan, the Islamic month of fasting, peasants from Java might 
emphasize their Islamic faith and affiliation, whereas in other settings 
they emphasize their membership in the national state by attending 
school, participating in family-planning programs, and belonging to 
village cooperatives, and by invoking the Pancasila (five principles; 
see Glossary), the state ideology, as a moral justification for personal 
and family choices. In a similar way, isolated hill tribes living in the 
interior of islands such as Sulawesi, Seram, or Timor might express 
devotion to ancestral spirits through animal sacrifice at home but 
swear loyalty to the Indonesian state in school or at the polls. A per- 
son's identity as an Indonesian is richly interwoven with familial, 
regional, and ethnic heritage. 

The Geographic Context 

Indonesia's variations in culture have been shaped by centuries of 
complex interactions with the physical environment. Although Indo- 
nesians in general are now less vulnerable to the vicissitudes of 
nature as a result of improved technology and social programs, it is 
still possible to discern ways in which cultural variations are linked 
to traditional patterns of adjustment to their physical circumstances. 

Geographic Regions 

Indonesia is a vast archipelagic country extending 5,120 kilome- 
ters from east to west and 1,760 kilometers from north to south. 
According to the Indonesian Naval Hydro-Oceanographic Office, 



98 



The Society and Its Environment 



the country encompasses 17,508 islands, about 6,000 of which are 
inhabited. There are five main islands (Sumatra, Java, Kalimantan, 
Sulawesi, and Papua), two major archipelagos (Nusa Tenggara — 
also known as the Lesser Sunda Islands — and the Maluku Islands — 
also called the Moluccas), and 60 smaller archipelagos. Three of the 
islands are shared with other nations: Kalimantan, the world's third- 
largest island — also known as Borneo — is shared with Malaysia and 
Brunei; Papua and Papua Barat provinces (two provinces carved 
from what was formerly called West New Guinea or, later, Irian 
Jaya) share the island of New Guinea with the nation of Papua New 
Guinea; and the island of Timor is divided between Timor-Leste 
(former East Timor) and Indonesia's Nusa Tenggara Timur Province 
(see fig. 6). Indonesia's total land area is 1,811,569 square kilome- 
ters. Included in the nation's total territory are another 93,000 square 
kilometers of inland waters (straits, bays, and other bodies). These 
areas, plus the seas and oceans immediately surrounding Indonesia, 
bring the country's generally recognized territory (land and water) to 
about 5 million square kilometers. The government, however, also 
claims a 200-nautical-mile exclusive economic zone (see Glossary) 
that brings the total to about 7.9 million square kilometers. 

Geographers have conventionally labeled Sumatra, Java (and 
Madura, a small island near Java's northeast coast), Kalimantan, and 
Sulawesi collectively as the Greater Sunda Islands. These islands, 
except for Sulawesi, lie on the Sunda Shelf, an extension of the 
Malay Peninsula and the Southeast Asian mainland. Far to the east 
are Papua and Papua Barat provinces, which take up the western half 
of the world's second-largest island, New Guinea, which lies on the 
Sahul Shelf. Sea depths on the Sunda and Sahul shelves average 200 
meters or less. Between these two shelves lie Sulawesi, Nusa Teng- 
gara, and the Maluku Islands, whose adjacent seas are 4,500 meters 
deep in some places. The term Outer Islands (see Glossary) is used 
inconsistently by various writers but is usually taken to mean those 
islands other than Java, Bali, and Madura. 

Volcanoes and Earthquakes 

The islands that make up Indonesia are highly unstable tectonically, 
and although the resultant volcanic ash has provided the basis for fer- 
tile soils, it makes agricultural conditions unpredictable in some areas. 
The nation has numerous mountains and some 400 volcanoes, about 
25 percent of which are active. Well-known examples are Mount Mer- 
api (Gunung Merapi), in Jawa Tengah Province, which last erupted in 

2007, and Soputan, in Sulawesi Utara Province, which last erupted in 

2008. Between 2000 and 2009 alone, 110 new or continuous volcanic 



99 




100 



The Society and Its Environment 



eruptions were recorded in Indonesia, mostly in Java. The most vio- 
lent geologic events in modern times have occurred in Indonesia: In 
1 8 1 5 the explosion of Mount Tambora (Gunung Tambora), a massive 
volcano in Nusa Tenggara Barat Province on the island of Sumbawa, 
reportedly killed an estimated 60,000 people. It last erupted in 1967. 
Krakatau, a volcano situated on an island between Java and Sumatra, 
erupted in 1883, and more than 36,000 died in the resulting tsunamis, 
which were felt as far away as the Arabian Peninsula, and changes in 
the water level were reported as far away as Wales. Krakatau is still 
active, having erupted as recently as March 2009. The Lumpur Sido- 
arjo (Lusi) mud volcano in Jawa Timur Province, which began in late 
May 2006 coincident with natural gas exploration drilling and, as 
some believe, an offshore earthquake, is an eruption of hydrogen sul- 
phide gas and hot mud rather than a traditional volcano with its explo- 
sive ejections and flows of lava. 

Earthquakes also frequently shake Indonesia. Thirty-eight major 
earthquakes, measuring between 6.5 and 9.1 magnitude — 26 of them 
greater than 7.0 — hit throughout most of the archipelago between 
2000 and 2009. On the morning of December 26, 2004, an offshore 
earthquake registering 9.1 magnitude created a massive tsunami that 
hit the northwestern coast of Sumatra, primarily the Special Region of 
Aceh (called Nanggroe Aceh Darussalam, 1999-2009), killing 
166,561 people and displacing another 203,817. Other tsunamis 
caused by this earthquake also devastated coastal and island areas of 
the Indian Ocean as far west as the east coast of Africa and as far 
north as Burma. Overall, the earthquake and tsunamis killed more 
than 227,898 persons and displaced more than 1.7 million in Indone- 
sia and 13 other countries. On March 28, 2005, another devastating 
earthquake, registering a magnitude of 8.6, struck the island of Nias 
and nearby islands in Sumatera Utara Province. It killed more than 
1,300 persons and displaced 40,000. More than 5,700 people were 
killed, 38,000 injured, and 600,000 left homeless when a 6.3 earth- 
quake hit offshore of the coast of the Special Region of Yogyakarta, 
on May 27, 2006. Then, on September 2, 2009, a 7.0 magnitude earth- 
quake struck Jawa Barat Province, causing severe damage and 72 
deaths, and was felt widely on Java. Several weeks later, on Septem- 
ber 30, 2009, a 7.6 magnitude earthquake hit Padang, Sumatera Barat 
Province, and was felt throughout Sumatra and Java, as well as in 
Malaysia, Singapore, and Thailand. It caused at least 1,100 deaths, 
more than 2,180 were injured, and thousands were missing amid the 
severe structural damage. 



101 



Indonesia: A Country Study 
Climate 

The main variable in Indonesia's climate is not temperature or air 
pressure but rainfall. The almost uniformly warm waters that make 
up 81 percent of Indonesia's area ensure that temperatures on land 
remain fairly constant. Traversed by the equator, the archipelago is 
almost entirely tropical in climate. Temperatures average 28° C on 
the coastal plains, 26° C in inland and mountain areas, and 23° C in 
the higher mountain regions. Winds are moderate and generally pre- 
dictable; monsoons usually blow in from the south and east between 
June and September and from the northwest between December and 
March. Typhoons and other large storms pose little hazard to mari- 
ners in Indonesia's waters; the primary danger comes from swift cur- 
rents in channels such as the Lombok, Sape, and Sunda straits. 

Extreme variations in rainfall are linked with the monsoons. 
There is a dry season (June to September), influenced by the Austra- 
lian continental air masses, and a rainy season (December to March) 
that is influenced by air masses from mainland Asia and the Pacific 
Ocean. Local conditions in Indonesia, however, can greatly modify 
these patterns, especially in the central islands of the Maluku group. 
This oscillating seasonal pattern of wind and rain is related to Indo- 
nesia's geographic location as an archipelago between two conti- 
nents and astride the equator. During the dry monsoon, high pressure 
over the Australian deserts moves winds from Australia toward the 
northwest. As the winds reach the equator, the Earth's rotation 
causes them to veer off their original course in a northeasterly direc- 
tion toward the Southeast Asian mainland. During the wet monsoon, 
a corresponding high-pressure system over the Asian mainland 
causes the pattern to reverse. The resultant monsoon is augmented 
by humid breezes from the Indian Ocean, producing significant 
amounts of rain throughout many parts of the archipelago. 

Prevailing wind patterns interact with local topographic condi- 
tions to produce significant variations in rainfall throughout the 
archipelago. In general, the western and northern parts of Indonesia 
experience the most precipitation because the northward- and west- 
ward-moving monsoon clouds are heavy with moisture by the time 
they reach these more distant regions. The average annual rainfall 
for Indonesia is around 3,175 millimeters. Western Sumatra, Java, 
Bali, and the interiors of Kalimantan, Sulawesi, and Papua are the 
most consistently damp regions of Indonesia, with rainfall measur- 
ing more than 2,000 millimeters per year. In part, this moisture orig- 
inates on certain high mountain peaks that, because of their location, 
trap damp air and experience more than 6,000 millimeters of rain a 
year. The city of Bogor, near Jakarta, has a high rainfall rate of 3,500 



102 



Small fishing boats with view of Manado Tua volcano, 

Sulawesi Utara Province 
Courtesy Anastasia Riehl 

to 4,000 millimeters annually. On the other hand, the areas closest to 
Australia — including Nusa Tenggara and the eastern tip of Java — 
tend to be dry, with some areas experiencing less than 1,000 milli- 
meters of rainfall per year. Some of the islands of southern Maluku 
experience highly unpredictable rainfall patterns, depending on local 
wind currents. 

The air temperature changes little from season to season or from 
one region to the next, but cooler temperatures prevail at higher eleva- 
tions. In general, temperatures drop approximately 1 ° C per 90 meters 
of increase in elevation from sea level; night frosts occur in some high 
interior mountain regions. The highest mountain ranges in Papua are 
permanently capped with snow. 

Located on the equator, the archipelago experiences relatively lit- 
tle change in the length of daylight hours from one season to the 
next; the difference between the longest day of the year and the 
shortest is only 48 minutes. The archipelago stretches across three 
time zones: Western Indonesian Time — seven hours in advance of 
Greenwich Mean Time (GMT) — applies to Sumatra, Java, and west 
and central Kalimantan; Central Indonesian Time — eight hours 
ahead of GMT — is observed in Bali, Nusa Tenggara, south and east 



103 



Indonesia: A Country Study 

Kalimantan, and Sulawesi; clocks are set to Eastern Indonesian 
Time — nine hours ahead of GMT — in the Malukus and Papua. The 
boundary between the western and central time zones — established 
in 1988 — is a line running north between Java and Bali through the 
center of Kalimantan. The border between the central and eastern 
time zones runs north from the eastern tip of Timor to the eastern tip 
of Sulawesi. Indonesia does not operate daylight-saving time in the 
summer. 

Environmental Concerns 

Centuries-old patterns of resource exploitation in Indonesia began 
to change very rapidly in the late twentieth and early twenty-frrst 
centuries. The rice-growing peasantry is shrinking as a result of 
mechanization, fertilizer use, and intensification of agriculture; the 
coastal commercial sector has been transformed by overfishing and 
new technology for interisland commerce; and traditional swidden 
farming communities of the upland forest have been increasingly 
crowded out by industrial logging. 

The cumulative effects of rising population density, urbanization, 
agricultural intensification, resource extraction, and manufacturing 
have had a significant impact on the Indonesian environment in 
recent decades. Home to the world's largest reef system, one of its 
largest expanses of rain forest, and some of its richest areas of bio- 
diversity, Indonesia is now experiencing serious environmental dete- 
rioration. Air pollution, caused by rapidly rising levels of motor- 
vehicle emissions (90 percent of vehicles still use leaded fuel) and 
by forest fires linked to palm-oil plantation development, have given 
rise to respiratory problems that have become the country's sixth 
most common cause of death. Forest fires in Kalimantan during 
1997-98 produced a thick, smoky haze that covered much of South- 
east Asia, resulting in closed schools and businesses as well as 
deaths and illnesses related to respiratory disorders. The fires also 
drew worldwide attention to the uncertain future of the region's for- 
est resources. 

Indonesia has some of the worst water pollution in Asia. The 
shortage of sewerage facilities is an especially serious problem. For 
example, because less than 3 percent of Jakarta's population is con- 
nected to a sewerage system, the city's waste is typically discharged 
either into private septic tanks or directly into rivers or canals. Sew- 
age disposal into such bodies of water is linked in particular with 
repeated epidemics of gastrointestinal infection. In rural areas, run- 
off from increased use of pesticides and fertilizers has resulted in 
raised levels of toxicity in the water supply, excessive accumulation 



104 



The Society and Its Environment 



of algae in riverbeds, and the consequent destruction of marine life. 
The coastal commercial sector suffers from environmental pressures 
originating in the highland interiors of the islands. Soil erosion from 
upland deforestation exacerbates the problem of silting downstream 
and into the sea. Silt deposits cover and kill once-lively coral reefs, 
creating mangrove thickets and making harbor access increasingly 
difficult, if not impossible, without massive and expensive dredging 
operations. 

National Territory: Rights, Responsibilities, and 
Challenges 

The legal rights to, and responsibility for, Indonesia's territorial 
environment are a matter of controversy. Among the continuing con- 
cerns are the exact boundaries between Indonesia and Timor-Leste; 
another issue of concern between the two states is sovereignty over a 
tiny uninhabited island off the coast of Timor that is called Pulau 
Batek by Indonesia but known locally as Fatu Sinai. Differences 
over the precise maritime boundaries between Australia and Indone- 
sia in the Timor Gap remain an area in need of reconciliation. In 
another dispute, the International Court of Justice ruled in favor of 
Malaysia in 2002 regarding jurisdiction over the Sipadan and Ligitan 
islands (off northeastern Kalimantan). However, Indonesia continues 
to assert a claim to the outer islands of the Ligitan group and has 
established a presence on them. In 2005 tensions flared again 
between Indonesia and Malaysia concerning Ambalat Island, located 
in the Sulawesi Sea (Celebes Sea) on the boundary between the two 
states, off the northeast corner of Kalimantan Timur Province. Bas- 
ing its claim on a doctrine of the political and security unity of archi- 
pelagic land and waters (wawasan nusantara), the Indonesian 
government has asserted its rights to marine and geologic resources 
within a coastal zone of 200 nautical miles. Indonesia, Malaysia, and 
Singapore each consider the Strait of Malacca (Selat Malaka in 
Bahasa Indonesia), one of the most heavily traveled sea-lanes in the 
world, to be their primary responsibility. At a conference in Singa- 
pore in 2004, the United States recognized the right of the three 
countries to organize security as they saw fit, while at the same time 
offering assistance for their efforts. 

Since the late 1990s, Indonesia has experienced major challenges to 
its territorial integrity. The most profound resulted from a United 
Nations (UN)-monitored referendum in August 1999 in East Timor on 
whether to accept special autonomy within Indonesia or to separate 
from Indonesia and declare independence. After 78.5 percent of East 
Timorese voted for independence, pro-Indonesia and pro-independence 



105 



Indonesia: A Country Study 

forces fought each other, and thousands died or fled to West Timor 
(Nusa Tenggara Timur Province) to avoid the fighting. The violence 
began shortly after President Bacharuddin J. (B.J.) Habibie announced 
the referendum and continued until well after the vote. On October 25, 
1999, the UN Transitional Administration in East Timor (UNTAET) 
was established, and on May 20, 2002, East Timor, as the Democratic 
Republic of Timor-Leste, became fully independent of Indonesia. Most 
of the estimated 200,000 refugees who went to West Timor had 
returned by 2003 (see Relations with Neighboring Nations, ch. 4; East 
Timor, ch. 5). 

Two other regional struggles in recent times were in the Special 
Region of Aceh, in northwestern Sumatra, and in Papua. In Aceh, 
the long-standing conflict between the Free Aceh Movement 
(GAM — see Glossary) and the Indonesian military intensified into 
an open secessionist effort. The struggle escalated in 1998, but two 
years later secret negotiations held in Geneva led to a Cessation of 
Hostilities Agreement signed on December 9, 2002. 

The parties had agreed to a dialogue leading to democratic elec- 
tions and a cessation of hostilities. Within six months, however, the 
agreement had broken down, and martial law was declared in the 
province until May 2004. Following the December 2004 earthquake 
and tsunami, a much more comprehensive peace agreement, brokered 
by former Finnish president Martti Ahtisaari, was officially signed in 
Helsinki on August 15, 2005, by chief Indonesian negotiator Hamid 
Awaluddin and GAM leader Malik Mahmud. The Indonesian govern- 
ment agreed to facilitate the establishment of Aceh-based political 
parties and to allow 70 percent of the income from local natural 
resources to stay within Aceh. On December 27, 2005, GAM leaders 
announced that they had disbanded their military wing and GAM 
itself was dissolved the next month (see Separatist Rebellions, ch. 5). 

Another important challenge to Indonesia's sovereignty comes 
from the Free Papua Organization (OPM). After years of sabotage, 
secret meetings, and public demonstrations, OPM gained consider- 
able international attention in January 1996 when members of the 
group kidnapped 14 members of a multinational World Wildlife 
Fund for Nature scientific expedition. All except two hostages were 
freed following negotiations; later a rescue operation was conducted 
in which six OPM members and the two remaining Indonesian hos- 
tages were killed. Although in 2001 local leaders were granted more 
financial and political autonomy and had been permitted a year ear- 
lier to change the name of their province from Irian Jaya to the 
locally more acceptable Papua, tension persists. (In 2003 Papua was 
subdivided into Papua and Irian Jaya Barat provinces; the latter was 



106 



The Society and Its Environment 



renamed Papua Barat in 2007.) Amnesty International reported 
grave concern about acts of torture and prisoner abuse in 2000 by the 
Indonesian military. Demonstrations for Papuan independence inten- 
sified in 2006 in the wake of revelations of pollution caused by the 
Grasberg mine, a source of copper, gold, and silver operated by 
Phoenix, Arizona-based Freeport-McMoRan Copper and Gold. In 
2008 Indonesian police arrested separatist leader Buchtar Tabuni as 
he was about to attend a massive rally in Jayapura, the capital of 
Papua, to show support for an international legislative caucus for 
Papua Barat. 

Even as Indonesia defended its claims to various territories, inter- 
national environmental groups were pressing Jakarta to accept envi- 
ronmental responsibility for those territories. Indonesia was encour- 
aged to monitor pollution in its national territorial waters and to take 
legal action to prevent the destruction of its rain forests. Since the late 
1960s, the government has addressed increasing environmental prob- 
lems by establishing resource-management programs, conducting 
environmental-impact analyses, developing better policy enforce- 
ment, and enacting appropriate laws to give government officials 
proper authority. Despite these efforts, corruption, overlapping com- 
petencies among government departments, and legal uncertainties 
about departmental jurisdictions have slowed progress against envi- 
ronmental degradation. 

Emerging Dynamics of Indonesian Communities 
Population 

Indonesia's population was estimated by U.S. government sources 
at 240,271,522 in July 2009. (The next Indonesian census was sched- 
uled for 2010.) This marked an increase of 37.6 million since 2000. 
The annual growth rate had changed slightly, from 1.3 percent in 
2000 to an estimated 1 . 1 percent in 2009, with a birthrate estimated at 
18.8 per 1,000 population. Life expectancy at birth for the total popu- 
lation stood at an estimated 70.8 years (versus 67.9 years in 2000), 
with males projected to live 68.3 years and females 73.4 years. Fertil- 
ity rates for women, based on births per woman, decreased slightly, 
from 2.6 in 2000 to an estimated 2.3 in 2009, and the infant mortality 
rate improved from 40.9 deaths per 1,000 live births in 2000 to an 
estimated 29.9 deaths per 1,000 in 2009. The overall death rate was 
estimated in 2009 at 6.2 deaths per 1 ,000 of the population. 

Indonesia is a young nation. In 2008 it was estimated that the 
median age was 27.6 years for the total population (males, 27.1; 
females, 28.1). The overall age structure was such that 28 percent of 



107 



Indonesia: A Country Study 



AGE-GROUP 



2009 




12 10 8 



8 10 12 



POPULATION IN MILLIONS 



AGE-GROUP 



2029 




12 10 8 



8 10 12 



POPULATION IN MILLIONS 



Source: Based on information from United States, Department of Commerce, Census Bureau, 

International Programs Center, International Data Base Population Pyramids (Indonesia) 
(Washington, DC, 2008), http://www.census.gov/ipc/www/idb. 



Figure 7. Age-Sex Ratio, 2009, and Projected Ratio, 2029 



108 



The Society and Its Environment 



the population was age 14 or younger, 66 percent was 15-64 years 
old, and 6 percent was 65 or older. Based on estimates for 2009, Indo- 
nesians aged nine or younger represent the largest age cohort, totaling 
some 44.9 million, or nearly 19 percent of the population (see fig. 7). 
Indonesia's gender ratio is fairly balanced, and comparable to that of 
its regional neighbors: the 2009 estimate was 1.05 males born for 
every female born, the same as for Australia, Brunei, Papua New 
Guinea, the Philippines, and Timor-Leste. Malaysia's gender ratio 
stood at 1.07:1 and Singapore's at 1.08:1. 

Family 

The structure, size, and function of the Indonesian family exhibit 
considerable variation in the country's hundreds of different ethno- 
linguistic groups. Enshrined in official rhetoric and documents as a 
model for the nation as a whole, the family is regarded as the foun- 
dation of morality, justice, and duty concerning public behavior. 
Although Indonesians in different parts of the archipelago have dif- 
ferent traditional notions about inheritance, marriage, and filial 
rights and responsibilities, certain commonalities are beginning to 
emerge, in part as a result of the influence of national laws, institu- 
tions, and policies, as well as the increasing integration of the popu- 
lation into a national economy. 

One of the most striking and far-reaching changes since the mid- 
1970s has been the continued decline in fertility. As a result of 
improved education, an effective family-planning program, and 
reduced child mortality, the average number of children born per 
Indonesian woman has steadily declined, from approximately 5.0 in 
1970 to an estimated 2.3 in 2009. The decline has been steepest in 
Java and Bali. Despite the reduction in family size, the archipelago is 
increasingly overcrowded, with an estimated population density of 
131 persons per square kilometer in 2009 (compared with 33.8 per 
square kilometer in the United States). In Java, Madura, and Bali, 
population densities are more than 900 per square kilometer. 

Since the early 1990s, Indonesian women have tended to bear 
fewer children as infant mortality has decreased. In 1991 the esti- 
mated infant mortality rate was 59 deaths per 1,000 live births. By 
1995 that figure had declined to 48 deaths; it then dipped to 40.9 by 
2000. In 2009 the infant mortality rate was estimated at 29.9 deaths 
per 1,000 live births. Strikingly, even as the number of births per 
woman has declined in Indonesia, there has been no evidence of a 
preference for sons in the number of children born or who survive as 
infants. Another factor influencing Indonesian families is a general 
trend toward equality in inheritance patterns and allocation of family 



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Indonesia: A Country Study 

resources. The gap between the amounts inherited by sons and 
daughters appears to have shrunk over the course of the 1980s and 
1990s, and by 2009 it had probably nearly closed. 

The mobility of working-age adults has increased greatly, meaning 
that households have become more dynamic in the early twenty-first 
century. The structure and size of households fluctuate more rapidly 
than in the past. This trend is both a cause and a consequence of the 
economic, social, and demographic changes that have occurred, as well 
as the result of transportation improvements (see Migration, this ch.). 

Despite these forces of rapid change, Indonesian marriages con- 
tinue to exhibit a typical pattern in which wives exert control over 
household finances and overall management of children and house- 
hold affairs while husbands and unmarried young adults are responsi- 
ble for discretionary spending and ties to the larger community. 
Polygamy is permitted but relatively rare. The law states that men and 
women are equal, and that both are responsible for maintaining the 
home and caring for the children. The rate of participation of women 
in the workforce has remained more or less stable, and, overall, Indo- 
nesian marriages have experienced a decline in the divorce rate to 
less than 40 percent. This contrasts with the 1960s, when the rate 
peaked at nearly 60 percent. The reasons for this decline are contro- 
versial, but financial, political, and social insecurity, combined with 
growing religious conservatism, may be factors in keeping marriages 
together. The actual divorce process exhibits considerable variation in 
different parts of the archipelago, but in general a divorce is relatively 
easy to obtain in Islamic courts by either a man or a woman. Judicial 
divorces are harder to get. 

National, Religious, and Local Authority 

Most Indonesians have a strong sense of citizenship in the larger 
Indonesian state and its various levels of government in addition to 
feeling attached to their family and household. Three generations of 
schoolchildren have worn similar uniforms, sung common songs, 
learned a common language, and recited similar facts of history, civ- 
ics, and the Pancasila ideology. The red and white Indonesian flag is a 
common sight throughout the archipelago. Uniformed state employ- 
ees and ordinary citizens alike have all grown accustomed to carrying 
their kartu tanda penduduk, or national identification card. 

In 1998, however, after nearly 32 years of gradual centralization of 
power and authority under Suharto (1967-98), the relationship of 
ordinary Indonesians to their vast nation-state began to change rapidly 
(see The Political Process, ch. 4). One of the most noticeable changes 
was a trend toward challenging central authority occurring at the same 



110 



The Society and Its Environment 



time as a move toward decentralization. Assertions of local control 
and authority became more frequent in the early twenty- first century. 
In some cases, such assertions took the form of vigilante violence and 
protests, as local citizens bypassed the courts and took the search for 
justice into their own hands. As protests and unrest increased, citizens 
began monitoring calls for change (generally dubbed reformasi — see 
Glossary) in newly uncensored newspapers and Internet sources; print 
circulation and Internet subscriptions both increased rapidly. 

These challenges often took the form of assertions of religious 
rather than secular authority, as the leadership of Islamic groups, long 
suppressed during the New Order government of Suharto, began to 
find its voice. One striking trend was visible in Java among young 
women, who, in increasing numbers, began to wear the jilbab, the tra- 
ditional Islamic women's head covering. Anthropologist Suzanne 
Brenner has argued, based on extensive interviews with Javanese 
women, that this was less a statement of submission to an ideology of 
male-dominated tradition than an assertion of independence from a 
perceived status quo of secular authoritarianism. Young women, in 
other words, were employing the veil or head covering as a way of 
making a statement about their feelings toward what they regarded as 
the moral laxity and corruption of the state, and of society more gener- 
ally. It did not necessarily signal a stance in favor of an Islamic state. 

Urbanization and Decentralization 

One of the most significant trends in Indonesia since the 1 970s has 
been toward urbanization. The segment of the population living in 
urban areas grew from 17 percent in 1971, to 31 percent in 1990, and 
to 46 percent in 2003. In 2006 Indonesia's Urban and Regional Devel- 
opment Institute projected that the nation's urban population could 
reach more than 50 percent by 2010 and 60 percent by 2025. Surveys 
showed that the movement toward urban areas, particularly those in 
Jawa Barat Province, southwestern Sulawesi, and Kalimantan, among 
other areas, stemmed not from the innate lure of the cities but from 
the lack of employment in the countryside. Migrants seemed to view 
the pollution, crime, anonymity, and grinding poverty of the city as 
short-term discomforts that would eventually give way to a better life. 
For high school and college graduates with no prospects for employ- 
ment in the rural areas, this may in fact have been a correct assump- 
tion. But for those migrants without capital or qualifications, the main 
hope for employment was in the so-called informal sector, which 
offered work such as street vending, scavenging, and short-term day 
labor (see Employment and Income, ch. 3). Many migrants also culti- 
vated tiny but nutritionally important gardens. 



Ill 



Indonesia: A Country Study 

Much urban growth has been in mid-sized cities. Jakarta's popula- 
tion (8.5 million, with a population density of nearly 12,900 persons 
per square kilometer in 2009) has experienced a rate of increase of 
about 1 percent a year, but there were signs of decentralizing trends in 
the early twenty-first century. For example, much growth has occurred 
in the greater Jakarta metropolitan area, known as Jabodetabek (for 
Jakarta-Bogor-Depok-Tangerang-Bekasi), home to an estimated 
24.3 million in 2007, rather than in Jakarta proper. While the capital 
enjoyed a disproportionate amount of the nation's resources in tech- 
nology, health care, wealth, and political power during the Suharto 
era, after 1998 provincial governments began to demand a larger 
share. On January 1, 2001, a rapid decentralization program began 
that placed more authority at the level of the regency (kabupaten, a 
subprovincial but nonmunicipal unit of government) and municipality 
(kota) (see Local Government, ch. 4). This process reportedly was 
going well in the mid-2000s. 

The transformation of a well-established pattern of urbanization 
may have been possible because, as anthropologist Pauline D. Milone 
observed in the mid-1960s, Jakarta has never been a true primate city 
in terms of being the only center for economic, political, administra- 
tive, higher education, and technical functions in the way that, for 
example, Bangkok has been for Thailand. In Java, Surabaya has 
always been a major import-export center and has long been home to 
an important naval station, and Bandung has been a center for trans- 
portation, higher education, and industry. Nonetheless, in terms of 
population growth and as a symbol of the centralization of power in 
the nation, Jakarta has grown steadily in size and importance. 

Migration 

Indonesians, particularly Javanese, are sometimes stereotyped as 
highly immobile, rarely venturing beyond the confines of their vil- 
lage environment, but this image may be due to a lack of clear data 
and an extraordinarily complex pattern of movement in the popula- 
tion. By the early 1990s, out-migration had become a common 
response to overcrowded conditions caused by population growth. 
Some of these resettlements resulted in conflicts with the indigenous 
populations, and by the late 1990s, many transmigrants were fleeing 
conflicts in Aceh, Kalimantan, Maluku, Sulawesi, and Timor. As a 
result, by 2000 the government's long-standing Transmigration Pro- 
gram (see Glossary) was discontinued. 

Many communities, particularly in Sumatra, have a long tradition 
of sending young adult males on merantau (cyclical out-migration) 
as a means for them to gain experience and income and reduce 



112 





household expenses. Since the 1970s, however, interprovincial 
migration has increased dramatically for all regions. In addition, the 
financial crisis of 1997-98 resulted in a major increase in migration 
overseas in search of work, and the violence in Aceh, Kalimantan, 
Maluku, Sulawesi, and Timor has resulted in some 1.2 million inter- 
nally displaced persons, about half of whom are living in refugee 
camps. According to the 2000 census, some 7.1 million of all Indo- 
nesian males living in urban areas (16.6 percent of this population 
category) were migrants. Among individual localities, Jakarta led 
with 42.6 percent of its male population being migrant, followed 
closely by Kalimantan Timur Province, with 41 .3 percent, and Papua 
and Riau, each with 39.0 percent. The proportion in rural areas was 
much less; overall, only 6.1 percent of males in these areas nation- 
wide were emigrants. Kalimantan Timur and the province of Riau 
had the greatest proportions, with 30.7 percent and 28.2 percent, 
respectively. 

Indonesians were also engaging in what demographers call circu- 
lar migration and other kinds of commuting in greater numbers than 



113 



Indonesia: A Country Study 

ever before. This trend was linked in part to the steep increase in the 
number of motor vehicles, from 3.0 per 1,000 population in the 1960s 
to 26.2 in 1980, 46.3 in 1990, 78.1 in 2000, and 132 in 2007. With the 
widespread availability of public bus transportation connecting cities 
and villages, many workers commute 50 kilometers or more daily to 
work. Others live away from their homes for several days at a time in 
order to work. The World Bank has estimated that 25 percent of rural 
households have at least one family member working for part of the 
year in an urban area. 

In part because of increasing migration, Indonesians of different 
ethnic backgrounds and occupations are increasingly intermingling. 
They more frequently find themselves in circumstances in which 
they cannot rely on kin and village networks for social support, and 
so they look to government services for help, particularly in the areas 
of education and health care (see Education; Health, this ch.). 

Social Class 

The experience of population mobility in the archipelago has not 
necessarily resulted in social mobility in terms of social class. 
Indeed, recent studies underscore the continuing importance of 
social stratification in Indonesia, as least as measured by regional 
inequalities in income and consumption. However, scholars and pol- 
icy analysts continue to debate the degree to which social classes can 
be defined in ethnic, economic, religious, or political terms. While it 
is clear that Indonesia is a highly stratified society, and that sensitiv- 
ity to prestige or status (gengsi) is widespread, it is nonetheless diffi- 
cult to identify an upper class. Hereditary ruling classes and 
traditional elites reinforced by their positions in the Dutch colonial 
bureaucracy no longer possess unchallenged access to political 
power and wealth (see Modernism and Nationalism in the Colonial 
Age, ch. 1). Indeed, they cannot even claim to form an elite. The real 
power holders — generals, politicians, and wealthy capitalists of the 
postindependence period — are newcomers to their positions, and, 
apart from extravagant conspicuous consumption and cosmopolitan- 
ism, they demonstrate few clear institutional and cultural patterns 
that suggest they constitute a unitary group. 

Defining a lower class in Indonesia is equally difficult. Even 
before the banning of the Indonesian Communist Party (PKI — see 
Glossary) in 1966, Indonesia's poor formed alliances that had less to 
do with class than with economics, religion, and community ties. In 
some cases, the poor peasantry identified across class lines with 
orthodox Muslim landowners on the basis of their common religious 
ideologies or aliran kepercayaan (streams of belief). This alliance 



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The Society and Its Environment 



was particularly evident in lowland Jawa Timur Province. In other 
cases, small landowners united against both the Islamic right wing 
and Chinese entrepreneurs. There also were divisions between the 
indigenous, or long-settled, peoples (pribumi — see Glossary) and 
later Chinese and Arab immigrants. The oil boom of the 1970s 
affected society and income distribution in ways that benefited the 
landed peasantry and the urban middle class. However, no indepen- 
dent social group based on lower-class affiliations emerged as a 
major political force. 

Income disparities between the Outer Islands and the rest of the 
country and between rural and urban areas remain a major cause of 
concern, although the productivity gap between Java and the Outer 
Islands has narrowed. While the urban areas of Indonesia, especially 
Java and Bali, grew disproportionately wealthy in relation to their 
counterparts in more rural areas and the Outer Islands through much 
of the 1990s, they were also hit particularly hard by the 1997-98 
financial crisis. By 2000, income and consumption inequalities were 
back to levels experienced in the 1980s. United Nations Develop- 
ment Programme data based on the Gini index (see Glossary) indi- 
cate that Indonesia stands comparatively well regarding income 
inequality. For example, the Gini index for Indonesia in 2008 was 
estimated at 0.34, significantly lower than the indexes for several 
neighboring countries: Singapore (0.42), the Philippines (0.44), 
Malaysia (0.49), and Papua New Guinea (0.51). 

Between the nation's poor and privileged classes lies a complex 
mosaic of groups forming what might loosely be called a middle 
class. Not characterized by a common political vision, a set of eco- 
nomic interests, ethnic identification, or even income levels, the 
notion of a middle class in Indonesia is invoked by outsiders and 
analysts but rarely defined, especially by Indonesians themselves. 
While middle-income Indonesians appear to share some consump- 
tion patterns — the purchase and exclusive use of consumer durables 
such as televisions, motorcycles, newspapers, cell phones, and DVD 
players — the decentralization of power after 1998 does not seem to 
have resulted in an empowered middle class. As Richard Robison 
and Vedi Hadiz argued in 2004, the Indonesian oligarchy adapted to 
the collapse of the New Order and the financial crisis in some new 
ways but continues to use state power for private interests. 

Civil Society 

Although the family, the community, and the government are 
important sources of authority in Indonesia, nongovernmental orga- 
nizations (lembaga swadaya masyarakat, or LSM, or also sometimes 



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Indonesia: A Country Study 

organisasi nonpemerintah, or ornop), such as foundations or charita- 
ble organizations (yayasan), associations (perserikatan), and move- 
ments (gerakan), play an increasingly important role in defining and 
shaping social life. While some yayasan, for example, provide com- 
plex but significant financial loopholes for businesses, since the 
1980s, environmental, legal aid, and women's groups have played an 
increasingly important public role. 

The increasingly free news media are an important means of 
expression for Indonesian civil society. Immediately preceding the 
fall of Suharto in 1998, Indonesians began to enjoy expanded access 
to print and electronic news sources. Although not completely unfet- 
tered, the news media were vibrant and played an increasingly 
important role in informing public debate. Immediately upon 
Suharto's departure, however, the media were openly reporting on 
strikes, popular demonstrations, and other expressions of opposition 
to government authority. Intimidation by officials and private inter- 
ests remained a serious problem, but journalists reported and advo- 
cated positions at odds with those of the government, sometimes at 
their peril. Media observers, such as Krishna Sen and David T. Hill, 
believe that the Internet may also have played a role in this new 
openness, as the freedom it offered during the waning days of the 
Suharto era became a constant reminder of the absence of openness 
and freedom in other media. 

Islamic civic organizations constitute another important manifes- 
tation of civil society in Indonesia. In the period following the 1997- 
98 economic crisis and the downfall of Suharto, these organizations 
played an important role in filling the vacuum of authority. Well 
before the term civil society became widespread in the 1980s, 
Islamic organizations in Indonesia participated in activities that 
mediated between the state and the family. For instance, Muham- 
madiyah (Followers of Muhammad) is one of the two most impor- 
tant, modern Islamic social-religious organizations in Indonesia. 
Established in 1912, it has played an increasingly important role in 
social and cultural spheres of Indonesian life, such as education, 
finance, socioeconomic development, health care, and care for indi- 
gent people and orphans. After the collapse of the New Order in 
1998, when new political parties were being established across the 
archipelago, Muhammadiyah had the opportunity to transform itself 
from a social and cultural organization into a political party. How- 
ever, the membership rejected this change, and in 2008 no official 
link existed between Muhammadiyah and any political party. 

Indonesia's other first-rank Muslim organization, the Nahdlatul 
Ulama (literally, "revival of the religious teachers," but often trans- 



116 



The Society and Its Environment 



lated as Council of Scholars), was founded in 1926 as a religious vol- 
untary organization by traditional Muslim religious scholars. It is the 
largest Muslim organization in Indonesia, with a membership of 
approximately 35 million. Unlike Muhammadiyah, the more ortho- 
dox Sunni (see Glossary) Nahdlatul Ulama in the 1950s was also a 
political party, but it now is strongly oriented toward civic and social 
activities. Its base is rural and traditional, practicing forms of Islam 
strongly linked to legal, theological, and mystical traditions that are 
nurtured in traditional boarding schools (pondok pesantren). Nahd- 
latul Ulama emphasizes tolerance in its view of society. In 1983 it 
decided to accept the Indonesian state ideology, Pancasila, as the 
foundation of its social programs, and to work for a just society for 
all Indonesians, not just Muslims. In 1998 Nahdlatul Ulama unoffi- 
cially backed the formation of the National Awakening Party (PKB), 
and its leader, Abdurrahman Wahid, was elected president by the 
People's Representative Council (DPR) in 1999. However, the PKB's 
moderate stance, and opposition to an Islamic state, led more conser- 
vative members to leave the party. Although Wahid was ousted from 
power in 2001, he and Nahdlatul Ulama continued (until Wahid's 
death in 2009) to be voices for tolerance, secular government, and 
democracy. 

As in many other societies, civil-society organizations in Indone- 
sia ideally promote peace, justice, and social tolerance, but that is not 
always the reality. For instance, on October 12, 2002, terrorists asso- 
ciated with the radical group Jemaah Islamiyah (Congregation of 
Islam) blew up two Bali nightclubs, killing 202 people. On August 
5, 2003, individuals allegedly linked to the same group struck the 
Jakarta JW Marriott Hotel, killing 14. Nonetheless, a national poll in 
2003 suggested that politically militant Islam was not on the rise. 
Fully 85 percent of the respondents indicated that they did not sup- 
port the idea of an Islamic state or rollbacks of democratic freedoms. 
In spite of high-publicity attacks by militant Muslim groups, Muslim 
conservatives play a far smaller role in national politics than they did 
in the 1950s (see Islamic Political Culture, ch. 4; Terrorism, ch. 5). 

Violence, Vengeance, and Law 

Indonesia experienced a high level of civil violence from about 
1996 to 2003. Instances included ethnic conflict in Sumba (Nusa 
Tenggara Timur); apparently ethnic and religious strife in Kaliman- 
tan, Sulawesi, Ambon, and Halmahera (in the Malukus); sectarian 
rioting in the cities of Situbondo (Jawa Timur) and Tasikmalaya 
(Jawa Barat); race rioting in Jakarta; gang warfare in Timor; and 
government repression of student protests at Trisakti University in 



117 



Indonesia: A Country Study 

Jakarta on May 12, 1998. The cumulative casualty toll was in the 
thousands, and the number of displaced persons rose to more than 
500,000, according to the U.S. Committee for Refugees. 

The predominant theme to this unrest, according to some analysts, 
was not religion, ethnicity, or politics, but rather a tendency to use 
extralegal means to exact vengeance and retaliate against enemies. 
As the Suharto administration began to assume power, it was 
involved in a bloody retaliation against alleged communist actions 
during 1965-66; for the next 30 years, vigilante neighborhood watch 
groups consisting of young men routinely captured and killed 
alleged thieves without legal process but with the implicit approval 
of the government. Because the court system was viewed as corrupt 
and susceptible to bribery, and many law enforcement agencies were 
nearly bankrupt because of the financial crisis, many Indonesians 
came to believe that violence was the only route to justice. The vio- 
lence of 1996-2003 represented a continuation and intensification of 
these patterns. 

Religion and Worldview 

Religion in Indonesia is a complex and volatile issue, not easily 
analyzed in terms of social class, region, or ethnic group. Long dis- 
couraged by the New Order government (1966-98) from political 
participation, Islam, Christianity, Hinduism, Buddhism, and other 
religions were increasingly influential frameworks for defining 
social participation after 1998. The state guaranteed tolerance of cer- 
tain religions (agama) regarded as monotheistic by the government, 
but popular violence between Christians and Muslims in Java, 
Sulawesi, Kalimantan, Ambon, and Halmahera made those guaran- 
tees difficult to honor. In some cases, the police and army were on 
different sides of clashes defined in religious terms. 

Islam 

Islam is the dominant religion by far in Indonesia, with the great- 
est number of adherents: around 86.1 percent of the population 
according to the 2000 census; in 2009 this would have been about 
207 million people. No other country in the world has more Muslims 
than Indonesia. 

The main strand of Islamic practice in Indonesia by far is Sunni, 
with only a very small number of Shia (also Shiite — see Glossary). 
Differing understandings of the role of the clergy are a key distinc- 
tion between Sunni and Shia. Emphasizing predestination and prede- 
termination by Allah, Sunni clerics interpret the sunna within limits 



118 




imposed by centuries of learning and scholarship. Shia clerics 
emphasize free will and the infallibility of divinely inspired imams 
to interpret ancient texts. Cutting across the difference between 
Sunni and Shia groups, a small minority of Indonesians can be char- 
acterized in terms of what Australian scholar Greg Fealy calls radi- 
cal Islam, although even mainstream Muslims sympathize with some 
aspects of their teachings, if not their practices. Among these radical 
groups in Indonesia are Darul Islam (House of Islam), Jemaah 
Islamiyah (internationally regarded as a terrorist organization), 
Majelis Mujahidin Indonesia (Indonesian Islamic Warriors' Coun- 
cil), and Front Pembela Islam (Islamic Defenders' Front). These 
groups share a sense that the West (that is, Christians and Jews) has 
used economic and military power to enfeeble Islam; their solution 
is to call for a return to the pure Islam of the righteous ancestors (as- 
salaf as-salih), or Salafism. Varieties of Salafism include Wahha- 
bism, the official form of Islam in Saudi Arabia. 

According to orthodox practice, Islam is a strictly monotheistic 
religion in which God (Allah, or, in Indonesian, Tuhan, which is also 



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Indonesia: A Country Study 

used to refer to the Christian God and other gods) is both a pervasive 
presence and a somewhat distant figure. The Prophet Muhammad is 
not deified but rather is regarded as a human who was selected by 
God to spread the word to others through the Quran, Islam's holy 
book, the revealed word of God. Islam is a religion based on high 
moral principles, and an important part of being a Muslim is com- 
mitment to these principles. Islamic law (sharia, or syariah in Indo- 
nesian) is based on the Quran; the sunna, which includes the hadith 
(hadis in Indonesian), the actions and sayings of Muhammad; ijma, 
the consensus of local Islamic jurisprudence and, sometimes, the 
whole Muslim community; and qiyas, or reasoning through analogy. 
Islam is universalist, and in theory there are no national, racial, or 
ethnic criteria for conversion. 

Over the course of the mostly peaceful introduction of Islam to 
Indonesia beginning in the ninth century AD, tensions periodically 
arose between orthodox Muslims and practitioners of more syncretis- 
tic, locally based religions. These tensions are still evident in the early 
twenty-first century. In Java, for instance, they are expressed in the 
contrast between a santri (see Glossary), a pious Muslim, and an 
abangan (see Glossary), an adherent to a syncretistic blend of indige- 
nous, Hindu-Buddhist beliefs with Islamic practices, sometimes 
called kejawen (Javanism), agama Jawa (Javanese religion), or keba- 
tinan (mysticism — see Glossary). In Java, santri not only refers to a 
person who is consciously and exclusively Muslim, but also describes 
persons who have removed themselves from the secular world to con- 
centrate on devotional activities in Islamic schools called pesantren — 
literally, the place of the santri, but meaning Islamic school. Although 
these religious boarding schools, typically headed by a charismatic 
kiai (Muslim religious scholar), provide education for only a minority 
of Indonesian children (less than 10 percent), they remain an impor- 
tant symbol of Muslim piety, particularly in rural areas. 

There is also a long history of religious practice associated with 
more mystical and often highly syncretistic beliefs. Drawing vari- 
ously on Hindu-Buddhist ideas about self-control and intellectual 
contemplation, as well as more animistically inclined ideas about the 
spiritual character of nature, and often based on miraculous revela- 
tions, various kinds of hybrid Islamic beliefs flourished in Java until 
a presidential decree in 1965 urged consolidation under the rubric of 
the main scriptural religions (agama), including Islam, Christianity, 
Buddhism, Hinduism, and Confucianism. Several of the more mysti- 
cal varieties of Islam continued to flourish under the Suharto regime, 
and some continued to struggle for autonomy and recognition by the 
government, eventually receiving recognition in 1973 as keper- 



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The Society and Its Environment 



cayaan (faiths), albeit under the umbrella of one of the scriptural 
agama. Among the more prominent of these faiths was kebatinan. 
Only nominally Muslim, kebatinan is an amalgam of animist, 
Hindu-Buddhist, and Muslim, mostly Sufi (see Glossary), spiritual 
practices concerned with harmonizing the inner self with the outer 
material world. Spirits are believed to inhabit natural objects, human 
beings, artifacts, and grave sites of important wali (Muslim saints). 
Illness and other misfortunes are traced to such spirits, and if sacri- 
fices or pilgrimages fail to placate angry deities, the advice of a 
dukun, or healer, is sought. While it connotes a turning away from 
the militant universalism of orthodox Islam, kebatinan moves 
toward a more internalized universalism. In this way, it seeks to 
eliminate distinctions between the universal and the local, the com- 
munal and the individual. 

Another important tension dividing Indonesian Muslims is that 
between traditionalism and modernism. The nature of this antipathy is 
complex and a matter of considerable debate. One key issue concerns 
the self-sufficiency of scripture and the moral responsibility of the 
individual. Modernists emphasize the absolute and transparent author- 
ity of the Quran and the responsibility of individuals to follow its 
teachings; traditionalists contend that Quranic texts can be ambiguous, 
and that it is wiser to trust in the collective wisdom of past teaching. 
While traditionalists accept a variety of ritual forms, they underscore 
the responsibility of believers to the community, and are less con- 
cerned with individual responsibility to interpret scripture. Specifi- 
cally, traditionalists are suspicious of modernists' support of the urban 
madrassa {madrasah in Bahasa Indonesia), a reformist school that 
includes the teaching of secular topics. The modernists' goal of taking 
Islam and carrying it more directly to the people has been opposed by 
traditionalists because it threatens to undermine the authority of the 
kiai. On the other hand, some modernists accuse traditionalists of 
escapist tendencies and of failing to directly confront the individual 
responsibility to make sense of a changing world. One point of agree- 
ment is that both modernists and traditionalists have sought, unsuc- 
cessfully, to add a clause to the first tenet of the Indonesian 
constitution requiring that, in effect, all Muslims adhere to the sharia. 
In fact, some even hint that modernist and traditionalist santri harbor 
greater loyalty toward the ummah (community of believers) of Islam 
than to the Indonesian state. 

Christianity 

Christianity — Roman Catholicism and Protestantism — is the most 
rapidly growing religion in Indonesia, although Christians are modest 



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Indonesia: A Country Study 

in number compared to adherents to Islam (8.7 percent of the popula- 
tion versus 86.1 percent according to the 2000 census). Christianity 
has a long history in the islands, with Portuguese Jesuits and Domini- 
cans operating in Maluku, southern Sulawesi, and Timor since the 
sixteenth century. When the Dutch defeated Portuguese forces in 
1605 and began what was to be more than 350 years of Dutch pres- 
ence in the Indonesian archipelago, however, the Catholic missionar- 
ies were expelled, and the Dutch Reformed Church, a Calvinist 
denomination, became the dominant Christian presence in the region, 
as it would be until Indonesia became independent (see The National 
Revolution, 1945^9, ch. 1). Because the United East Indies Com- 
pany (VOC) was a secular enterprise, and Calvinism was a strict and 
intellectually uncompromising interpretation of Christianity that 
demanded a thorough understanding of what, for Indonesians, were 
foreign scriptures, Christianity advanced little in Indonesia until the 
nineteenth century. Only a few small communities endured, in Java, 
Maluku, northern Sulawesi, and Nusa Tenggara (primarily on the 
islands of Roti and Timor). After the dissolution of the VOC in 1799, 
and the adoption of a more comprehensive view of their mission in 
the archipelago, the Dutch permitted Christian proselytizing in the 
territory. This evangelical freedom was put to use by the more toler- 
ant German Lutherans, who began work in Sumatra among the Toba 
Batak in 1 861, and by the Dutch Rhenish Mission in central Kaliman- 
tan in 1845. In addition, Jesuits established successful Catholic mis- 
sions, schools, and hospitals throughout the islands of Flores, Timor, 
and Alor in the late nineteenth century. 

The twentieth century witnessed the influx of many new Protestant 
missionary groups, as well as the continued growth of Catholicism 
and of large regional and reformed Lutheran churches. Following the 
1965 coup attempt, all nonreligious persons were labeled atheists and 
hence were vulnerable to accusations of harboring communist sym- 
pathies (see The "Coup" and Its Aftermath, ch. 1). At that time, 
Christian churches of all varieties experienced explosive growth in 
membership, particularly among people who felt uncomfortable with 
the political aspirations of Islamic parties. 

Most Christians in Indonesia are Protestants (about 19 million in 
2009) of one denomination or another, with particularly large concen- 
trations located in the provinces of Sumatera Utara, Papua, Papua 
Barat, Maluku, Kalimantan Tengah, Sulawesi Tengah, Sulawesi Utara, 
and Nusa Tenggara Timur. Large concentrations of Roman Catholics 
(a total of about 8 million in 2009) live in Jawa Tengah, Kalimantan 
Barat, Papua, Papua Barat, and Nusa Tenggara Timur. In addition, a 
substantial number of ethnic Chinese Indonesians are Roman Catho- 



122 



Nativity scene in front of a Roman Catholic Church on Sulawesi 

Courtesy Anastasia Riehl 

lie. Catholic congregations grew less rapidly in the 1980s and 1990s, 
in part because of the church's heavy reliance on European personnel. 
These Europeans experienced increasing restrictions on their mission- 
ary activities imposed by the Muslim-dominated Department of Reli- 
gion (later called the Department of Religious Affairs). 

Hinduism 

Indonesian Hinduism, an amalgam of related traditions and cults 
that explains the nature of the universe in terms of interactions among 
numerous gods, is strongly associated with Bali. In 1953, in response 
to the central government's exclusion of Balinese Hinduism from its 
list of officially recognized religions, religious leaders on that island 
sought official recognition of Agama Hindu Bali (Hindu Balinese 
Religion) as a creed equivalent to Islam, Catholicism, and Protestant- 
ism. Led by Pandit Shastri, various Hindu reform organizations on 
Bali agreed in 1958 on the Hindu Dharma (Principles of Hinduism), 
which emphasized the Catur Veda (religious poems), the Upanishads 
(treatises of Brahmanic knowledge), and the Bhagavad Gita, as well 
as two Old Javanese texts (Sarasamuccaya and Sanghyang Kama- 
hayanikan). Together, these works came to form the holy canon of 
Balinese Hinduism. Other Hindu sacred texts, such as the Puranas 



123 



Indonesia: A Country Study 

(Sanskrit cosmogonic histories), were relegated to a minor position. 
In addition, a daily prayer called the trisandhya was devised by Pan- 
dit Shastri to correspond to the five daily prayers of Muslims. These 
reforms were accepted by Sukarno in 1959, and Balinese Hinduism 
gained full recognition in 1963. 

Arriving in the archipelago before the second century AD with 
traders and missionaries from India, Hindu beliefs were greatly mod- 
ified when adapted to Indonesian society. The central concept of rit- 
ual purity, maintained through a division of society into occupational 
groups, or castes (varna, literally color), was never rigidly applied in 
Indonesia. The categories of Brahman (priests; brahmana in Indone- 
sian), Kshatriya (ruler-warrior; satria in Indonesian), Vaishya (mer- 
chant-farmer; waisya in Indonesian), and Shudra (commoner-servant; 
sudra in Indonesian) do exist in Bali; besides the category of Brah- 
man, however, they appear to have little influence over occupational 
choices, or even over social status and marital opportunities. Two 
Hindu epics, the Mahabharata (Great Battle of the Descendants of 
Bharata) and the Ramayana (The Travels of Rama), have become 
classics among Indonesians, both Hindu believers and others, espe- 
cially in Java, and are rendered in wayang (see Glossary) and dance 
performances. 

Indonesian Hindu believers are relatively few outside Bali, where 
they make up more than 93 percent of the population. Others are scat- 
tered throughout the other 32 provinces and special regions, where 
diverse, and largely indigenous, religious practices have sought and 
gained recognition as Hindu by the Department of Religious Affairs. 
On a nationwide basis, only about 1.8 percent of the population was 
Hindu according to the 2000 census, although the U.S. Department of 
State reported 10 million adherents in 2009. Because lacking an offi- 
cial agama was associated with communism during the New Order, 
and being communist was a crime punishable by death or exile, some 
of Indonesia's heterogeneous animist, ancestor worship, and syncretic 
cults sought refuge under the tolerant Hindu aegis. Among these non- 
Balinese communities, one finds, for example, the adherents of the 
Kaharingan religion in Kalimantan Tengah, where government statis- 
tics generally have counted them among Hindus as 7.8 percent of the 
local population. In addition, there are significant communities 
labeled Hindu among the Toraja in Sulawesi Tengah and Sulawesi 
Selatan provinces, among the Karo Batak in northern Sumatra, and in 
Jawa Tengah and Jawa Timur provinces, most notably among the 
Tenggerese. 

Anthropologist Robert Hefner has noted that significant changes 
in state policy occurred with respect to Javanese Hinduism in the late 
1980s and early 1990s. During the early phases of the New Order, 



124 



Ruins of a Hindu temple in Yogyakarta 
Courtesy Library of Congress Prints and Photographs Division, 
Lot 11356, LC-USZ62-95443, digital ID cph 3b41593 

syncretically and mystically inclined Javanese previously affiliated 
loosely with Islam had converted to Hinduism. While there was gov- 
ernment support initially for such groups, including the kebatinan, 
pressure from conservative Muslim groups on the one hand and gov- 
ernment leadership on the other resulted in an increasingly poor fit 
between the syncretic practice of Javanese Hinduism and the official 
Hindu dharma. 

Buddhism 

Introduced before the second century AD by the same waves of 
traders and scholars who brought Hinduism, Indonesian Buddhism is 
now overwhelmingly associated with the ethnic Chinese and is an 
unstable product of complex accommodations among religious ide- 
ology, Chinese ethnic identification, and a gradually more tolerant 
policy by the central government. Traditionally, Chinese Daoism, 
Confucianism {agama Konghucu), and Buddhism, as well as the 
mass Buddhist organization Perhimpunan Buddhis Indonesia (Per- 
buddhi), founded in 1958, all had adherents in the ethnic Chinese 
community. Following the events of 1965, with any deviation from 
the monotheistic tenets of the Pancasila regarded as treason, the 



125 



Indonesia: A Country Study 

founder of Perbuddhi, Bhikku Ashin Jinarakkhita, proposed that 
there was a single supreme deity, Sang Hyang Adi Buddha. He suc- 
cessfully sought confirmation for this striking innovation to Bud- 
dhist beliefs in ancient Javanese texts, and even in the shape of the 
Borobudur temple in Jawa Tengah Province. After 1965 the number 
of Buddhists swelled; some 90 new monasteries were built, mostly 
supported by Indonesia's Chinese population, but also drawing sig- 
nificant numbers from syncretistically oriented Javanese disaffected 
by the increasingly strict emphasis on doctrinaire forms of Islam. By 
1987 there were seven schools of Buddhism affiliated with the Per- 
wakilan Umat Buddha Indonesia (Walubi): Theravada, Buddhayana, 
Mahayana, Tridharma, Kasogatan, Maitreya, and Nichiren. In 2009 
Buddhism had an estimated 2 million followers in Indonesia (less 
than 1 percent of the population), with a growing presence in Kali- 
mantan Barat Province, home to large numbers of ethnic Chinese. 

Confucianism and Daoism 

The New Order administration officially tolerated Confucianism. 
However, because it was regarded as a system of ethical relations 
rather than a religion per se, it was not represented in the Department 
of Religion. Daoism, which is practiced both as a philosophy and a 
religion, is recognized by the department as an official religion. 

The Emerging National Culture 

Living Environments 

The government of Indonesia saw itself as having a responsibility 
to advance a national culture throughout most of the New Order 
period, a project that was linked to requirements of national develop- 
ment and political integration. Government mandates aside, however, 
as more and more of the Indonesian population sought employment 
in large, poorly integrated cities consisting of diverse ethnic groups, 
the concept of a national culture had great appeal as a way of regulat- 
ing these changing urban environments. Although the central govern- 
ment attempted to guide the formation of this culture through 
educational curricula, celebrations of national holidays, and careful 
control of the national media (popular art, television, and print 
media), this emerging culture came about only partly through central 
planning. Evidence of an emerging national culture also appeared in 
the far less controlled layout and social organization of cities; rou- 
tines of social interaction using the official national language, Bahasa 
Indonesia; patterns of eating and preparing food; the viewing of team 



126 



Altar in a Buddhist temple, Tomohon, Sulawesi Utara Province 

Courtesy Anastasia Riehl 

sports, such as soccer, badminton, and volleyball; movies and televi- 
sion programming; and material displays of wealth. 

In smaller Indonesian cities, the heart of urban culture before the 
mid-twentieth century was a commercial sector surrounding a cen- 
tral square. The Dutch left a legacy of a basic civil architecture and 
street plans for large cities and towns in Java, Sumatra, and Bali, but 
after World War II most failed to experience a level of improved 
urban design and services commensurate with their tremendous pop- 
ulation growth. Many cities, as a result, had minimal or makeshift 
services, with very simple sanitation, transportation facilities, and 
fire protection. 

Indonesian cities are internally segmented in complex, overlap- 
ping ways that differentiate ethnic groups, income levels, and pro- 
fessional specializations. Some older neighborhoods tend to house 
well-to-do business owners and high-level government officials, 
whereas other newer areas tend to be home to migrant communities 
from the rural areas. Some of these areas retain their system of close- 
knit social networks and are distinguished by the label kampung (vil- 
lage). However, the boundaries between one area and another are 
often unclear. 



127 



Indonesia: A Country Study 



Language 

The major languages of Indonesia belong to the Austronesian fam- 
ily, a group of agglutinative languages spoken in the area bounded by 
Madagascar in the western Indian Ocean and Easter Island in the 
eastern Pacific Ocean. There is a considerable diversity in the lan- 
guages used in Indonesia. No fewer than 731 languages — the vast 
majority Austronesian, the rest Papuan and used in parts of Timor, 
Papua, and Halmahera — existed in the early twenty- first century. 

Based on reports of ethnic self-identification in the 2000 census, 
the primary languages spoken by 2 million or more people were Java- 
nese (83 million), Sundanese (30 million), Malay/Indonesian (17 mil- 
lion), Madurese (6.7 million), Batak (6.1 million), Minangkabau (5.4 
million), Buginese (5.1 million), Balinese (3 million), and Acehnese 
(2.2 million). In addition, some 2 million inhabitants spoke one of 
several dialects of Chinese. Arabic and languages of India and Europe 
also are used. 

The central and most successful feature of the Indonesian national 
culture is probably the Indonesian language. Malay was used for cen- 
turies as a lingua franca in many parts of the archipelago. The term 
Bahasa Indonesia, which refers to a modified form of Malay, was 
coined by Indonesian nationalists in 1928 and became a symbol of 
national unity during the struggle for independence. Bahasa Indone- 
sia is spoken in more than 90 percent of households in Jakarta. Out- 
side the capital, only 10 to 15 percent of the population speaks the 
language at home, but this number appears to be on the rise. In Java- 
nese areas, only 1 percent to 5 percent of the people speak Bahasa 
Indonesia in the home. Nationwide, some 17 million Indonesians use 
Bahasa Indonesia as a primary language, while more than 150 million 
to 1 80 million others use it as a second language. It is now indisput- 
ably the language of government, schools, national print and elec- 
tronic media, and interethnic communication. In many provinces, it is 
the primary language of communication between ethnic Chinese 
shopkeepers and their non-Chinese patrons. 

Bahasa Indonesia is infused with highly distinctive accents, 
vocabularies, and styles in some regions (particularly Maluku, parts 
of Nusa Tenggara, and Jakarta), but there are many similarities in 
patterns of use across the archipelago. For example, it is common to 
vary the use of address forms depending on the rank or status of the 
individual to whom one is speaking. This variation is not as complex 
as in the elaborately hierarchical Javanese language, but it is none- 
theless important. For instance, in Bahasa Indonesia respected elders 
are typically addressed in kinship terms — bapak (father or elder) or 
ibu (mother). The use of second-person pronouns in direct address is 



128 



The Society and Its Environment 



generally avoided in favor of more indirect references unless speaker 
and listeners are on intimate terms. In casual contexts, however, such 
as when one is speaking to taxicab drivers, street peddlers, and close 
friends, formal textbook Indonesian often gives way to the more 
ironic, sly, and earthy urban forms of address and reference. 

Food, Clothing, and Popular Culture 

Although Indonesia has a varied environment, and many different 
ethnic cuisines, rice is a national staple, even in areas such as eastern 
Indonesia, where the main source of starch is corn, cassava, taro, or 
sago. On ceremonial occasions such as funerals, modern weddings, 
and state functions, foods such as sate (small pieces of meat roasted 
on a skewer), krupuk (fried chips made with rice flour and flavored 
with fish or fried shrimp), and highly spiced curries of chicken and 
goat are commonly served. At public events, these foods are often 
placed on a table from which guests serve themselves buffet style. 
Rice is placed in the center of the plate, with meats or other condi- 
ments around the edges. Food is eaten — usually quite rapidly and 
without speaking — with the fingertips or with a spoon and fork. 
Water is generally drunk only after the meal, when men (rarely 
women) smoke their distinctive clove-scented kretek cigarettes. 

On many formal national occasions, men wear untucked batik 
shirts with no tie. Head wear usually consists of a peci, a black felt 
cap once associated with Muslims or Malays but which acquired a 
more secular, national meaning during the struggle for indepen- 
dence. Indonesian men generally wear sarongs only at home or on 
informal occasions. Women wear sarongs on formal occasions, 
along with the kebaya, a tight-fitting, low-cut, long-sleeved blouse. 
On these occasions, women often tie their hair into a bun, sometimes 
adding a hairpiece. In addition, they often carry a selendang, a long, 
narrow cloth draped over the shoulder, which on less formal occa- 
sions is used to carry babies or objects. Increasing numbers of young 
women have adopted traditional Islamic clothing such as the jilbab 
(head scarf) or other head covering. 

Urban Indonesian nightlife centers on night markets, where peo- 
ple shop in toko (stores) and warung (food stalls). Also popular are 
forms of the performing arts such as pop music concerts, puppet 
shows, and the cinema. American and Indian films are popular, while 
Indonesian motion pictures selectively emphasize certain aspects of 
Indonesian life. Indonesian-made films are set in cities — even 
though the population has traditionally been largely rural — and most 
films employ Bahasa Indonesia even though most viewers are Java- 
nese. There is rarely mention of religion or ethnicity, even though 
most of the population has a religious affiliation (see Religion and 



129 



Indonesia: A Country Study 

Worldview, this ch.). Anthropologist Karl Heider has observed that 
Westerners in general are unambiguously presented as modern and 
having no tradition whatsoever. Western women are presented as 
having few constraints on their sexuality. The audiences for films 
consist almost entirely of teenagers and young adults and are more 
male than female. 

Television use in Indonesian households increased dramatically in 
the late twentieth and early twenty-first centuries, as did the variety 
of broadcast stations and programming, especially after the end of 
the New Order in 1998. Public and private radio stations also bring a 
range of popular culture programs to people throughout the archipel- 
ago (see Post and Telecommunications, ch. 3). 

Popular programs include sinetron (television dramas), which are 
serialized, Indonesian- language dramas about everyday life. In addi- 
tion, variety news and entertainment shows are available, such as 
Selamat Pagi Indonesia (Good Morning Indonesia) and the "soft 
news" program Seputar Indonesia (Around Indonesia). Popular for- 
eign dramatic serials from Australia, India, Japan, and the United 
States also appear in dubbed, subtitled, or original-language ver- 
sions. Most programming is in Bahasa Indonesia, although some 
local arts programs are presented in regional languages. Nielsen 
Indonesia regularly conducts rating surveys of the Indonesian televi- 
sion market, and the results are influential in determining program- 
ming. Recent figures suggest that Indonesia is one of the fastest- 
growing markets for television advertising as well as for burgeoning 
private and commercial television networks (see Media, ch. 4). 

Sources of Local Identification 

Tradition and Multiethnicity 

Indonesian society comprises numerous ethnic groups. The Java- 
nese are the largest, at 41.0 percent of the total population. Sunda- 
nese make up 15.0 percent, followed by Malays (3.4 percent) and 
Madurese (3.3 percent). More than 14 percent of the population con- 
sists of numerous small ethnic groups or minorities. The precise 
extent of this diversity is unknown, however, because the Indonesian 
census stopped reporting data on ethnicity in 1930, under the Dutch, 
and only started again in 2000. In that year's census, nine categories 
of ethnicity were reported (by age-group and province): Jawa, Sunda 
and Priangan, Madura, Minangkabau, Betawi, Bugis and Ugi, Ban- 
ten, Banjar and Melayu Banjar, and lainnya (other). 

As this increasingly mobile, multiethnic nation moves into its sev- 
enth decade of independence, Indonesians are becoming aware — 



130 



The Society and Its Environment 



through education, television, cinema, print media, and national 
parks — of the diversity of their own society. When Indonesians talk 
about their cultural differences with one another, one of the key 
words they use is adat. The term is roughly translated as "custom" or 
"tradition," but its meaning has undergone a number of transforma- 
tions in Indonesia. In some circumstances, for instance, adat has a 
kind of legal status — certain adat laws (hukum adat) are recognized 
by the government as legitimate. These ancestral guidelines may 
pertain to a wide range of activities: agricultural production, reli- 
gious practices, marriage arrangements, legal practices, political suc- 
cession, or artistic expression. 

Even though the vast majority of them are Muslims, Indonesians 
maintain very different systems of social identification. For example, 
when Javanese try to explain the behavior of a Sundanese or a Bali- 
nese counterpart, they might say "because it is his adat." Differences 
in the ways ethnic groups practice Islam are often ascribed to adat. 
Each group may have different patterns of observing religious holi- 
days, attending the mosque, expressing respect, or burying the dead. 

Adat in the sense of "custom" is often viewed as one of the deep- 
est — even sacred — sources of consensus within an ethnic group, how- 
ever, the word itself is from Arabic. Through centuries of contact with 
outsiders, Indonesians have a long history of contrasting themselves 
and their traditions with those of others, and their notions of who they 
are as a people have been shaped in basic ways by these encounters. 
On some of the more isolated islands in eastern Indonesia, for 
instance, one finds ethnic groups that have no word equivalent to adat 
because they have had very little contact with outsiders. 

Early in the New Order, the notion of adat came to take on a 
national significance in touristic settings such as Balinese artistic 
performances and museum displays. Taman Mini, a kind of ethno- 
graphic theme park on the outskirts of Jakarta, seeks to display and 
interpret the cultural diversity of Indonesia. This 100-hectare park is 
landscaped to look like the Indonesian archipelago in miniature 
when viewed from an overhead tramway. There is a house for each 
province, to represent vernacular architecture. The park sells distinc- 
tive local hand weapons, textiles, and books explaining the customs 
of the province. One powerful message of the park is that adat is 
contained in objective, material culture, which is aesthetically pleas- 
ing and indeed marketable, but which is more or less distinct from 
everyday social life. Furthermore, the exhibits convey the impres- 
sion to some observers that ethnicity is a simple aesthetic matter of 
regional and spatial variations rather than an issue of deep emotional 
or political attachments. However, the park provides visitors with a 



131 



Indonesia: A Country Study 

vivid and attractive (if not always convincing) model for how the 
Indonesian national motto, Bhinneka Tunggal Ika (Unity in Diver- 
sity, a Javanese slogan dating to fourteenth-century Kediri poet Mpu 
Tantular's poem "Sutasoma") might be understood. 

When Indonesians talk about their society in inclusive terms, they 
are more likely to use a word such as budaya (culture) than adat. 
One speaks of kebudayaan Indonesia, the "culture of Indonesia," as 
something grand, that refers to traditions of refinement and high civ- 
ilization. The dances, music, and literature of Java and Bali and the 
great monuments associated with these islands' religion are often 
described as examples of "culture" or "civilization" but not "cus- 
tom" (or adat). However, as the following descriptions show, the 
variety of sources of local identification underscore the diversity 
rather than the unity of the Indonesian population. 

Javanese 

There are approximately 83 million Javanese, the majority of 
whom live in Jawa Timur and Jawa Tengah provinces; most of the 
rest live in Jawa Barat Province and on Sumatra, Kalimantan, 
Sulawesi, and other islands. (Altogether, some 110 million people 
live on Java.) Although many Javanese express pride at the grand 
achievements of the illustrious courts of Surakarta and Yogyakarta 
and admire the traditional arts associated with them, most Javanese 
tend to identify not with that elite tradition, or even with a lineage or 
clan, but with their own village of residence or origin. These vil- 
lages, or desa, are typically situated on the edge of rice fields, sur- 
rounding a mosque, or strung along a road. 

Most Javanese villages are divided into smaller administrative 
units, each known as either a rukun kampung (village mutual assis- 
tance association) or rukun tetangga (neighborhood association). 
Rukun is an important Javanese word of Arabic origin describing 
both "state of being and a mode of action .... a state in which all par- 
ties are at least overtly at social peace with one another," according 
to anthropologist Robert Jay; it is "a process of sharing through col- 
lective action." Anthropologist Mary Hawkins has argued that while 
modern forms of contract labor and technology may have eroded the 
rural communalism implied in earlier senses of rukun, the term 
remains important as an ideological construct for representing val- 
ued aspects of collective life. Australian anthropologist Patrick 
Guinness has written that the neighborhood is the "largest social 
grouping, whose members participate in household rituals, gather for 
rituals, organize working bees, whose youth band together for sports 
teams and organizations, who maintain arisan (rotating credit asso- 



132 



The Society and Its Environment 



ciations) and who hold certain property such as funeral equipment." 
In rural areas, these groups also sometimes collaborate on harvesting 
their rice. The rukun associations were rooted in the ideals of the 
family but became official administrative units during the Japanese 
occupation in World War II. Many of these local communities orga- 
nized security arrangements called ronda malam (night watches). 
Neighbors watched closely for any suspicious activity and partici- 
pated vigorously in the apprehension of thieves, even exacting 
immediate justice on their own. The heads of these organizations 
were elected or appointed officials and were considered representa- 
tives of the government. 

Differences in social class are less elaborate and less pronounced 
in Javanese rural villages than in urban areas. In villages where land 
is relatively evenly distributed, some form of mutual labor exchange 
is common; in villages where there are large numbers of landless 
peasants, however, there also are relationships of a clear client-patron 
nature with landowners, who themselves rarely own more than two 
hectares. In urban centers, the distinctions among a refined, tradi- 
tional elite, an intermediate-level bourgeoisie sharing patterns of con- 
sumption, and a more collectivist peasantry are more pronounced. 

Leaders are usually male, in both the village and the urban neigh- 
borhood. Although some are political appointees, these leaders are 
theoretically chosen by popular consensus. This consensus system 
proceeds — ideally — through a discussion of different points of view, 
after which a senior-level participant makes a final decision. Although 
there is increasing acceptance of competitive elections, in many deci- 
sion-making contexts it is not uncommon to make use of a process 
referred to as musyawarah mufakat (deliberation with consensus). 

Javanese kinship ties are reckoned through the mother and father 
equally. The nuclear family of mother, father, and children is more or 
less independent; formal obligations between kin groups are not 
much greater than in Western societies. The reduced occurrence of 
divorce — rates were as high as 60 percent in some areas in the 
1960s — has made the shifting of responsibility for children — partic- 
ularly among the mother's kin — less likely in recent years. This 
three-decade trend toward more stable marriages is attributed to rises 
in the level of educational attainment, age at first marriage, and 
income level. Migrations during the 1997-98 financial crisis took a 
toll on marriages, but stricter laws and a more conservative religious 
ethos have mitigated some of those effects. Javanese have no clans, 
lineages, or other kin-based social groupings that, among some other 
ethnic groups, form the basis of corporate entities such as family 
businesses. Sons tend to treat their fathers with great formality and 



133 



Indonesia: A Country Study 

deference. Although the mother is the focus of the family in many 
respects — she usually handles the finances — she is often depicted as 
suffering the most when the family experiences any loss. She is usu- 
ally the one who disciplines the children, while the father is mostly 
occupied outside the home. 

The Javanese view childhood as a series of shocks from which 
children must be protected. Although the youngest children are 
much indulged, major transitions can be sharp and radical. The pro- 
cess of weaning, for instance, is traditionally a rapid one in which 
the mother simply leaves the child with a relative and then returns a 
few days later. Overall, however, a baby's general contentment and 
resistance to disease and misfortune are viewed as dependent on the 
child's being protected from any form of emotional upset. Babies are 
constantly held and nursed on demand; babies must not be disap- 
pointed. Once weaned, they are often released into the care of an 
older sibling or relative who indulges and protects them. 

Children become increasingly capable of withstanding the shocks 
and stresses of life as they grow older, in part because they have 
become more aware of the rules defining social interaction. The rules 
of etiquette help a child learn self-control. For example, children must 
learn to address their father respectfully, using refined speech. Failure 
to comply properly with the rules will result in a sharp reprimand. For 
Javanese, learning the proper degree of shame, according to anthro- 
pologist Ward Keeler, is a matter of becoming aware of one's vulnera- 
bility in interaction. Children learn that dealing with others in a face- 
to-face encounter always poses a threat to one's sense of self. 

Many of the rules of etiquette center on the proper use of lan- 
guage, which is more problematic in Javanese than in most other lan- 
guages. When addressing someone, Javanese speakers must choose 
from several different levels of politeness. These "speech levels" 
comprise words that have the same meaning but are stylistically dif- 
ferent. For instance, among the Javanese variations of the word 
"now," saiki is the least refined, while saniki is a little fancier, and 
samenika is the most elegant. Javanese has many such triads — so 
many that people cannot speak for long in the language without hav- 
ing to decide whether the situation is formal or informal and what 
the relations among the participants are. 

People generally use the highest level of language to speak to 
high-status people in formal situations and the lower levels to speak 
to people of lower rank or with whom they are most intimate. 
Although children learn to speak at the lowest level first, they gradu- 
ally are socialized to speak to some of their more distant kin and 
respected strangers in higher-level forms of Javanese. This formality 



134 



Javanese gamelan player 
Javanese New Year festival, Ponorogo, Jawa Timur Province 
Courtesy Embassy of Indonesia, Washington, DC 



135 



Indonesia: A Country Study 

is particularly common in cities, where there are marked distinctions 
in status. However, there is evidence that these practices are slowly 
changing. Many children who go elsewhere in Indonesia for work or 
school or who live overseas refuse to write letters home to their elders 
in Javanese because of their fear of making a glaring error. Increas- 
ingly, in formal situations, they use Bahasa Indonesia because they 
are no longer sure of the social situation at home. Although Bahasa 
Indonesia possesses a relatively simple system for indicating status 
distinctions, it is regarded as a foreign idiom among many Javanese. 

An expectation that women would use the higher levels more than 
men would be valid within the domestic environment — and primar- 
ily for the purpose of showing deference among their relatives. Men 
use more politeness levels in public than women do. Moreover, in 
the public sphere, the use of Javanese politeness levels is not so 
much associated with humility as it is with efforts to raise oneself 
above another. Men are more likely to see the use of politeness lev- 
els as a strategy for negotiating status. 

There is great diversity among Javanese religious practices. 
Although most Javanese are Muslims, the wide variations in Islamic 
beliefs and practices are associated with complex factors such as 
regional history and social class. The most pious, and recognizably 
Muslim, varieties of Javanese religion are associated with the santri 
tradition, nurtured by traditional Muslim schools. Santri hold more 
tightly to the moralistic tone of Islam and express the fundamental 
universalism of its teachings. They may make a pilgrimage (hajj in 
Indonesian) to Mecca, teach their children the Quran, and work for 
the social, spiritual, and even political advancement of the ummah. 
In contrast to the santri tradition, varieties of kejawen ("Javanist") 
religious practice variously incorporate pre-Islamic, animistic, and 
aesthetic forms of spirituality. Although some observers have distin- 
guished between elite and common varieties of kejawen practice, 
many now see the traditional aristocracy and peasantry losing their 
distinctiveness in this regard. Religiosity is expressed through fasts, 
trances, visits to graves, and performance genres such as wayang 
kulit (a form of shadow theater employing flat leather puppets), con- 
certs by gamelans (Javanese orchestras featuring percussive instru- 
ments), dance, and other arts of the courtly tradition, which are 
widely appreciated by the Javanese community as a whole. 

Most observers of Javanese religion agree that the core Javanese 
religious ritual is a brief feast known as the slametan. Neighbors, rel- 
atives, and coworkers may be invited to attend on the occasion of a 
birth, marriage, death, or change in status. The host typically gives a 
speech in high Javanese explaining the purpose of the event to the 



136 



The Society and Its Environment 



guests, after which some incense is burned, a prayer is recited in 
Arabic, and the special festive food is consumed, at least in part. 
Then, what is left is divided among the guests and taken home. 
Believers seek to protect themselves against harmful spirits by mak- 
ing offerings, enlisting the aid of a dukun (healer), or engaging in 
spiritual acts of self-control and right thinking. 

Balinese 

There is probably no group in Indonesia more conscious of its 
own ethnic identity than the nearly 3 million Balinese. Inhabitants of 
the islands of Bali and Lombok and the western half of Sumbawa, 
Balinese are often portrayed as a graceful, poised, and aesthetically 
inclined people. Although such descriptions date back six centuries 
or more and are at least partially based on legend, this characteriza- 
tion is also partly based on the realities in contemporary Indonesia. 
Virtually no part of Bali has escaped the gaze of tourists, who come 
in increasing numbers each year to enjoy the island's beautiful 
beaches and stately temples and to seek out an "authentic" experi- 
ence of its "traditional" culture. The market for "traditional" carv- 
ings, dance performances, and paintings has boomed, and many 
Balinese successfully reinvest their earnings in further development 
of these highly profitable art forms. 

Balinese have a long history of contrasting themselves profitably 
with outsiders. The contemporary distinctive Hindu religious prac- 
tices of the Balinese date back at least to the fifteenth and sixteenth 
centuries, when Javanese princes from Majapahit fled the advances 
of Islam and sought refuge in Bali, where they were absorbed into 
the local culture. Since that time, Balinese, with the exception of a 
minority of Muslims in the north, have maintained great pride in 
their own distinctiveness from the surrounding Muslim cultures. 
Since the terrorist bombing of two nightclubs in the Balinese beach 
town of Kuta in 2002 by Muslim extremists, tensions between Bali- 
nese and non-Balinese Muslims have increased. 

Balinese society is stratified, as with the Javanese. In Balinese 
society, however, the social hierarchy is described in distinctly 
Hindu terms: there is a small hereditary Brahman class, as well as 
small groups of Vaishya and Kshatriya classes. However, the Bali- 
nese caste system involves no occupational specializations or ideas 
about ritual contamination between the ranks. It does not prohibit 
marriage between ranks but does forbid women to marry beneath 
their class. The vast majority of Balinese, including many wealthy 
entrepreneurs and prominent politicians, belong to the Shudra (com- 
moner-servant) class. 



137 



Indonesia: A Country Study 

Unlike most Javanese, Balinese participate enthusiastically in 
several interlocking corporate groups beyond the immediate family. 
One of the most important of these is the dadia, or patrilineal 
descent group. This is a group of people who claim descent through 
the male line from a common ancestor. The group maintains a tem- 
ple to that ancestor, a treasury to support rituals associated with it, 
and certain chosen leaders. The prestige of a dadia depends in part 
on how widespread and powerful its members are. However, most of 
these organized groups tend to be localized, because it is easier to 
maintain local support for their activities and temple. Balinese prefer 
to draw spouses from within this group. These corporate kin groups 
can also be the basis for organizing important economic activities, 
such as carving cooperatives, gold- and silversmithing cooperatives, 
painting studios, and dance troupes. 

Another important affiliation for Balinese is with the banjar, or 
village compound, which overlaps with, but is not identical to, the 
dadia. The banjar and the dadia share responsibility for security, eco- 
nomic cooperation in the tourist trade, and the formation of inter- 
village alliances. The banjar is a council of household heads and 
oversees marriage, divorce, and inheritance transactions. In addition, 
it is the unit for mobilizing resources and labor for the spectacular 
cremations for which Bali has become increasingly well known. Each 
banjar may have individual orchestra, dance, and weaving clubs. 

Yet another important corporate group is the agricultural society, 
or subak, each of which corresponds to a section of wet-rice paddies. 
Each subak is not only a congregation of members who are jointly 
responsible for sacrificing at a temple placed in the center of their 
particular group of paddies, but also a unit that organizes the flow of 
water, planting, and harvesting. Because 50 or more societies some- 
times tap into a common stream of water for the irrigation of their 
land, complex coordination of planting and harvesting schedules is 
required. This complexity arises because each subak is independent. 
Although the government has attempted periodically to take control 
of the irrigation schedule, these efforts have produced mixed results, 
leading to a successful movement in the early 1990s to return the 
authority for the agricultural schedule to the traditional and highly 
successful interlocking subak arrangement. 

The very complexity of Balinese social organization has provided 
it with the flexibility to adapt to the pressures of modern life and its 
requirements for the accumulation, distribution, and mobilization of 
capital and technological resources. Although the Balinese remain 
self-consciously "traditional," they have been neither rigid in that 
tradition nor resistant to change. 



138 



The Society and Its Environment 



Peoples of Sumatra 

The large island of Sumatra forms the southwestern shore of the 
Strait of Malacca. Although nearly all of the approximately 20 eth- 
nolinguistic groups of Sumatra are devout practitioners of Islam, 
they nonetheless differ strikingly from one another, particularly in 
their family structures. 

Acehnese 

Residing in the Special Region of Aceh, Sumatra's northernmost 
provincial-level jurisdiction, the more than 2 million Acehnese are 
most famous throughout the archipelago for their devotion to Islam, 
their militant resistance to colonial and republican rule, and their 
tragic experience as victims of the tsunami that struck Aceh's west- 
ern coast on December 26, 2004. Although the Acehnese were 
renowned throughout the nineteenth century for their pepper planta- 
tions, most are now rice growers in the coastal regions. 

Acehnese do not have large descent groups; the nuclear family 
consisting of mother, father, and children is the central social unit. 
Unlike that of the Javanese or Balinese, the Acehnese family system 
shows marked separation of men's and women's spheres of activity. 
Traditionally, males are directed outward toward the world of trade. 
In the practice of merantau — going away from one's birthplace in 
order to return later — young adult males seek fortune, experience, 
and commercial repute. This may involve travel to another village, 
province, or island. This maturation process among males is viewed 
as growing out of the domestic female-dominated world of sensory 
indulgence and into the male world of reasoned rationality, the prac- 
tice of which is expressed through trade. One model of Acehnese 
family life is that a woman sends a man out of the house to trade and 
welcomes him back when he brings home money. When he has 
exhausted his money, she sends him out again. Meanwhile, women 
and their kin are responsible for working the fields and keeping the 
gardens and rice fields productive. This oscillating pattern of migra- 
tion encountered some difficulties in the 1980s and 1990s as increas- 
ing numbers of men failed to return to the Acehnese homeland, 
instead remaining and marrying in remote locations, such as Jakarta 
or Kalimantan. In addition, many Acehnese felt pressure from the 
continuing influx of temporary workers seeking employment in the 
natural gas and timber industries, and the conflict between the Indo- 
nesian army and Acehnese separatists. 

The August 16, 2005, peace agreement between the Free Aceh 
Movement (GAM) and the Indonesian central government was pro- 
pelled by the desire on both sides to smooth the flow of aid to victims 



139 



Indonesia: A Country Study 

of the December 2004 tsunami. The rebels dropped their secession 
demands, and the government agreed to give them some form of 
political representation. Since 2006 ex-GAM members have been 
elected as governor and to many lower-level posts in Aceh, and by 
2009 the remnants of GAM had splintered into several parties. 

Batak 

The term "Batak" designates any one of several groups inhabiting 
the interior of Sumatera Utara Province, south of Aceh: the Angkola, 
Karo, Mandailing, Pakpak, Simalungun, Toba, and others. The 
Batak number around 6 million and are mostly Christian, with some 
Muslim groups in the south and east. Historically isolated from 
Hindu-Buddhist and Muslim influence, they bear closer resemblance 
culturally to highland swidden cultivators elsewhere in Southeast 
Asia, even though most practice wet-rice farming. Unlike the Bali- 
nese, who have several different traditional group affiliations at 
once, or the Javanese, who affiliate with their village or neighbor- 
hood, the Batak traditionally orient themselves primarily to the 
marga, a landowning patrilineal descent group. Traditionally, each 
marga is a wife-giving and wife-taking unit. Whereas a young man 
takes a wife from his mother's clan (men must seek wives outside 
their own marga), a young woman marries into a clan within which 
her paternal aunts live. 

The marga has proved to be a flexible social unit in contemporary 
Indonesian society. Batak who resettle in urban areas, such as Medan 
or Jakarta, draw on marga affiliations for financial support and polit- 
ical alliances. While many of the corporate aspects of the marga 
have undergone major changes, Batak migrants to other areas of 
Indonesia retain pride in their ethnic identity. Batak have shown 
themselves to be creative in drawing on modern media to codify, 
express, and preserve their "traditional" adat. Anthropologist Susan 
Rodgers has shown how audiotaped cassette dramas with some 
soap-opera elements circulated widely in the 1980s and 1990s in the 
Batak region to dramatize the moral and cultural dilemmas of one's 
kinship obligations in a rapidly changing world. In addition, Batak 
have been prodigious producers of written handbooks designed to 
show young, urbanized, and secular lineage members how to navi- 
gate the complexities of their marriage and funeral customs. 

Minangkabau 

The Minangkabau — who predominate in the coastal areas of 
Sumatera Utara Province, Sumatera Barat Province, the interior of 
Riau Province, and northern Bengkulu Province — number more than 



140 



The Society and Its Environment 



5.4 million. Like the Batak, they have large corporate descent 
groups, but unlike the Batak, the Minangkabau traditionally reckon 
descent matrilineally. A young boy, for instance, has his primary 
responsibility to his mother's and sisters' clans. It is considered 
"customary" and ideal for married sisters to remain in their parental 
home, with their husbands having a sort of visiting status. Not every- 
one lives up to this ideal, however. In the 1990s, anthropologist Eve- 
lyn Blackwood studied a relatively conservative village in Sumatera 
Barat where only about 22 percent of the households were "matri- 
houses," consisting of a mother and a married daughter or daughters. 
Nonetheless, there is a shared ideal among Minangkabau in which 
sisters and unmarried lineage members try to live close to one 
another or even in the same house. 

Landholding is one of the crucial functions of the suku (female lin- 
eage unit). Because Minangkabau men, like Acehnese men, often 
migrate to seek experience, wealth, and commercial success, the 
women's kin group is responsible for maintaining the continuity of the 
family and the distribution and cultivation of the land. These family 
groups, however, are typically led by a penghulu (headman), elected 
by groups of lineage leaders. With the agrarian base of the Minangka- 
bau economy in decline, the suku — as a landholding unit — has also 
been declining somewhat in importance, especially in urban areas. 
Indeed, the position of penghulu is not always filled after the death of 
the incumbent, particularly if lineage members are not willing to bear 
the expense of the ceremony required to install a new penghulu. 

The traditions of sharia — in which inheritance laws favor males — 
and indigenous female-oriented adat are often depicted as conflict- 
ing forces in Minangkabau society. The male-oriented sharia appears 
to offer young men something of a balance against the dominance of 
law in local villages, which forces a young man to wait passively for 
a marriage proposal from some young woman's family. By acquiring 
property and education through merantau experience, a young man 
can attempt to influence his own destiny in positive ways. 

Increasingly, married couples go off on merantau; in such situa- 
tions, the woman's role tends to change. When married couples 
reside in urban areas or outside the Minangkabau region, women 
lose some of their social and economic rights in property. One appar- 
ent consequence is an increased likelihood of divorce. 

Minangkabau were prominent among the intellectual figures in 
the Indonesian independence movement. Not only were they 
strongly Islamic, they spoke a language closely related to Bahasa 
Indonesia, which was considerably freer of hierarchical connotations 
than Javanese. Partly because of their tradition of merantau, 



141 



Indonesia: A Country Study 

Minangkabau developed a cosmopolitan bourgeoisie that readily 
adopted and promoted the ideas of an emerging nation-state. 

Ethnic Minorities 

In Indonesia, the concept of ethnic minorities is often discussed 
not in numerical but in religious terms. Although the major ethnic 
groups claim adherence to one of the major world religions (agama) 
recognized by the Department of Religious Affairs — Islam, Christi- 
anity, Hinduism, Buddhism,, and Daoism — millions of other Indone- 
sians engage in religious or cultural practices that fall outside these 
categories. These practices are sometimes labeled animist or kafir 
(pagan). In general, these Indonesians inhabit the more remote, 
sparsely populated islands of the archipelago. Following the massacre 
of tens of thousands associated with the alleged 1965 coup attempt by 
"atheist" communists, mandatory religious affiliation became an even 
more intense political issue among minority groups. The groups 
described in the following sections represent a broad sample, chosen 
for their geographic and cultural diversity. 

Toraja 

The Toraja of Sulawesi Selatan, Sulawesi Barat, and Sulawesi 
Tengah provinces are one minority group that has been successful in 
gaining national and international attention. This group became 
prominent in the 1980s, largely because of the tourist industry, which 
was attracted to the region because of the picturesque villages and 
the group's spectacular mortuary rites involving the slaughter of 
water buffalo. 

Inhabiting the wet, rugged mountains of the interior of southern 
Sulawesi, the Toraja grow rice for subsistence and coffee for cash. 
Traditionally, they lived in fortified hilltop villages with from two to 
40 houses featuring large, dramatically sweeping roofs resembling 
buffalo horns. Until the late 1960s, many of these villages were 
politically and economically self-sufficient. This autonomy devel- 
oped in the late nineteenth and early twentieth centuries partly as 
protection against the depredations of the slave trade and partly as a 
result of intervillage feuding associated with headhunting. 

The Toraja have strong emotional, economic, and political ties to a 
number of different kinds of corporate groups. The most basic tie is 
that of the rarabuku, which might be translated as "family." Toraja 
view this grouping as encompassing relations of "blood and bone," 
that is, relations between parents and children — the nuclear family. 
Since Toraja reckon kinship bilaterally, through both mother and 
father, the possibilities for extending the concept of rarabuku in sev- 



142 



The Society and Its Environment 



eral different directions are many. Another important kind of group 
with which Toraja have close affiliations is the tongkonan (ancestral 
house), which contrasts with the banua (ordinary house). The tong- 
konan is a group of people who reckon descent from an original 
ancestor. The physical structures belonging to the tongkonan are peri- 
odically renewed by replacing their distinctively shaped roofs. This 
ritual is attended by members of the social group and accompanied by 
trancelike dances in which the spirits are asked to visit. A third 
important kind of affiliation is the saroan, or village work group, 
originally probably an agricultural work group based in a particular 
hamlet. Beginning as a medium for labor and credit exchange, the 
saroan has since evolved into a unit of cooperation in ritual activities 
as well. When sacrifices and funerals take place, groups of saroan 
exchange meat and other foods. 

The flexibility of these affiliations is partly responsible for the 
intensity of the mortuary performances. Because there is some ambi- 
guity about one's affiliation (that is, one's claims to descent are not 
only based on blood relationships but also on social recognition of the 
relationship through public acts), Toraja may attempt to demonstrate 
the importance of a relationship through elaborate contributions to a 
funeral, which provides an opportunity not only to show devotion to a 
deceased parent but also to claim a share of that parent's land. The 
amount of land an individual inherits from the deceased might 
depend on the number of buffalo sacrificed at that person's funeral. 
Sometimes people even pawn land to get buffalo to kill at a funeral so 
that they can claim the land of the deceased. Thus, feasting at funerals 
is highly competitive. 

With the oil boom in the 1960s and 1970s, there was massive out- 
migration among young upland Sulawesi men looking for jobs in 
northeastern Kalimantan. During this period, many of these youths 
became Christians. Although proselytization began among Toraja in 
the nineteenth century, mass conversions were provoked after the 
abortive 1965 coup and mass labor migrations in the 1970s and 1980s, 
a move that implied a rejection of many Toraja beliefs and practices. 
But when these migrants returned to their villages as wealthy men, 
they often wanted to hold large status displays in the form of funerals, 
causing what anthropologist Toby Alice Volkman has called "ritual 
inflation" as well as intense debates about the authenticity of their 
conversion to Christianity. Because of the successful efforts of highly 
placed Toraja officials in the central government, Toraja feasting prac- 
tices have been granted official status, loosely described as agama 
Hindu. 



143 



Indonesia: A Country Study 
Dayak 

Another group of ethnic minorities struggling for recognition are 
the peoples of southern, central, and eastern Kalimantan. From an 
outsider's perspective, most of the scattered ethnolinguistic groups 
inhabiting the interior of the vast island have been referred to as 
Dayak. The word is a collective term used by outsiders since 1836 to 
indicate the indigenous peoples of Kalimantan. Among the people 
labeled as Dayak, however, one finds Ngaju Dayak, Maanyan, and 
Lawangan, among others. Although they reside in longhouses that 
traditionally served as a means of protection against slave raiding 
and intervillage conflict, the Dayak are not communalistic. They 
have bilateral kinship, and the basic unit of ownership and social 
organization is the nuclear family. The various Dayak peoples have 
typically made a living through swidden agriculture. In regard to 
religion, they tend to practice either Protestantism or Kaharingan, a 
form of indigenous religious practice blending animism and ancestor 
worship classified by the government as Hindu. The Dayak perform 
elaborate death ceremonies in which the bones are disinterred for 
secondary reburial. 

Through its healing performances, Kaharingan serves to mold the 
scattered agricultural residences into a community, and it is at times 
of ritual that the Dayak peoples coalesce as a group. There is no set 
ritual leader, nor is there a fixed ritual presentation. Specific ceremo- 
nies may be held in the home of the sponsor. Shamanic curing, or 
balian, is one of the core features of these ritual practices. Because 
illness is thought to result in a loss of the soul, the ritual healing 
practices are devoted to its spiritual and ceremonial retrieval. In gen- 
eral, religious practices focus on the body, and on the health of the 
body politic more broadly. Sickness results from giving offense to 
one of the many spirits inhabiting the earth and fields, usually from a 
failure to sacrifice to them. The goal of the balian is to call back the 
wayward soul and restore the health of the community through 
trance, dance, and possession. 

Following the fall of Suharto in 1998, reassertions of ethnic iden- 
tity and land claims caused tensions leading to violence with Muslim 
migrants. Violent clashes between Dayaks and migrants had started 
even earlier, in December 1996, when a Madurese migrant accused 
of raping a Dayak woman was killed, and province-wide rioting 
occurred. In the following months, violence escalated, troops were 
flown in, a crackdown took place, and the cycle of violence contin- 
ued with schools, homes, and businesses burned by Dayaks and 
migrants in retaliation against one another. Hundreds died in these 
clashes, and thousands were displaced or reported missing. 



144 



Couple in wedding garb, 
Nusa Tenggara Timur 
Courtesy Embassy of 
Indonesia, Washington, DC 



Long-simmering feuds between Dayaks and mostly Madurese 
Muslim migrants erupted again over issues of land and economic 
competition in mid-2001, causing massive displacements of popula- 
tion. Angry Dayaks, dressed in traditional clothing, sometimes flam- 
boyantly displayed symbols of their headhunting tradition in gestures 
of defiance toward what they perceived as a flood of migrants and 
toward the central government as a whole. 

Weyewa 

The Weyewa inhabit the western highlands of Sumba and Nusa 
Tenggara Timur Province, where they cultivate rice, corn, and cas- 
sava using both slash-and-burn methods and continuous irrigation of 
paddy fields. They supplement this income through the sale of live- 
stock, coffee, vanilla, cloves, and their distinctive brightly colored 
textiles. 

There were few challenges to Weyewa notions of political and 
religious identity until the 1970s. Because Sumba is a rather dry and 
infertile island, located away from the ports of call of the spice trade, 
it was comparatively insulated from the Hindu-Buddhist, Muslim, 
and later Dutch influences, each of which helped shape the character 



145 



Indonesia: A Country Study 

of Indonesia's cultures. Each Weyewa belongs to a kabizu, a patrilin- 
eal clan whose founding ancestors are spirits requiring frequent rit- 
ual propitiation, gifts, and respect in exchange for continued 
prosperity among the descendants. Each clan is headquartered in a 
fortified hilltop wanno kalada (ancestral village); the most tradi- 
tional villages are characterized by houses with spectacular high- 
pointed thatch roofs. Young people are supposed to seek spouses 
outside their clan, and clan members assist with the often substantial 
marriage payments that are required. 

The Weyewa system of ritual production and exchange began to 
undergo major technological development and an economic shift in 
the 1970s and 1980s that resulted in a gradual weakening of the 
authority of lineages. With greater amounts of arable land available 
as a result of improved irrigation techniques and more crops pro- 
duced because of the use of faster-growing and higher-yielding vari- 
eties of rice, the legal and cultural rights to these new resources came 
to be assigned to individuals rather than to clans. Younger farmers 
were increasingly reluctant to invest in costly, large-scale ritual 
feasts honoring the spirits. Meanwhile, government officials put fur- 
ther pressure on traditional leaders to give up ritual feasting practices 
as "wasteful" and "backward." Furthermore, as with the Kaharingan 
adherents of Kalimantan, failure to affiliate with an approved reli- 
gion was regarded as potentially treasonous. Unlike the Toraja and 
others, however, the Weyewa were not politically organized for the 
preservation of their indigenous religion. Most people simply con- 
verted to Christianity as a symbolic gesture of participation in the 
nation-state. Indeed, whole villages in the late 1980s and early 1990s 
conducted feasts in which residents settled their debts with ancestral 
spirits and became Christians. The number of Weyewa professing 
affiliation with the Christian religion (either Roman Catholic or Cal- 
vinist Protestant) jumped from approximately 20 percent in 1978 to 
more than 90 percent in 2005. 

Sumba did not escape violence during the post- Suharto reform 
period, but the rioting took on distinctive forms. Because the central 
government was generally perceived in eastern Indonesia as a boun- 
tiful — if inequitable — source of funds for education, development, 
and jobs, the collapse of central authority resulted in open disputes. 
In November 1998, conflict broke out along ethnic lines as Weyewa 
men sought to defend the reputation of an ethnic Weyewa govern- 
ment official accused of corruption. The ensuing riots left at least 20 
people dead and more than 600 homes destroyed. The public perfor- 
mance of peace rituals in 1999 began a slow, painful process of 
rebuilding trust between aggrieved parties. 



146 



The Society and Its Environment 



Asm at 

The approximately 65,000 Asmat people of the south-central allu- 
vial swamps of Papua Province are of a Papuan genetic heritage. 
They live in villages with populations that vary in size from 35 to 
2,000 inhabitants. Until the 1950s, warfare, headhunting, and canni- 
balism were constant features of Asmat social life. The people would 
build their houses along river bends so that an enemy attack could be 
seen in advance. Houses in coastal areas still are generally built on 
pilings two or more meters high, to protect residents from daily 
flooding by the surging tides of the brackish rivers. In the foothills of 
the Jayawijaya Mountains, Asmat live in tree houses that are five to 
25 meters off the ground. In some areas, they also build arboreal 
watchtowers as much as 30 meters above the ground. 

The Asmat are primarily hunters and foragers who subsist by gath- 
ering and processing the starchy pulp of the sago palm, finding grubs, 
and hunting down the occasional wild pig, cassowary, or crocodile. 
Although the Asmat population has steadily increased since coming 
into contact with missionaries and government health workers, the for- 
est continues to yield an adequate supply and variety of food. Accord- 
ing to anthropologist Tobias Schneebaum, "Some Asmat have learned 
to grow small patches of vegetables, such as string beans, and a few 
raise the descendants of recently imported chickens. The introduction 
of a limited cash economy through the sale of logs to timber compa- 
nies and carvings to outsiders has led many Asmat to consider as 
necessities such foods as rice and tinned fish; most have also become 
accustomed to wearing Western-style clothing and using metal tools." 

Many Asmat have converted to Christianity, although a large 
number continue to practice the religion of their ancestors. For 
example, many believe that all deaths — except those of the very old 
and very young — come about through acts of malevolence, either by 
magic or actual physical force. Ancestral spirits demand vengeance 
for these deaths. The ancestors to whom they feel obligated are rep- 
resented in shields, in large, spectacular wood carvings of canoes, 
and in ancestor poles consisting of human figurines. Until the late 
1980s, the preferred way for a young man to fulfill his obligations to 
his kin and his ancestors and prove his sexual prowess was to take 
the head of an enemy and offer the body for cannibalistic consump- 
tion by other members of the village. 

The first Dutch colonial government post was not established in 
Asmat territory until 1938, and a Catholic mission began its work 
there only in 1958, but the pace of change in this once remote region 
greatly increased after the 1960s. Beginning in the early 1990s, 
many Asmat enrolled their children in Indonesian schools, and many 



147 



Indonesia: A Country Study 

converted to Christianity. As large timber, oil, and mining companies 
expanded their operations in the region, the fragile, low-lying man- 
grove forests that were home to many Asmat came under threat from 
industrial waste and soil erosion. The Asmat appear to be gaining 
some national and international recognition for their artwork; how- 
ever, this fame has not resulted in their acquiring any significant 
political input into decisions of the Indonesian government affecting 
the use of land in traditional Asmat territory. Although there is cur- 
rently little evidence of Free Papua Organization (OPM) activity 
among the Asmat, there has been a history of resistance to logging 
companies and other outside intruders, often in the form of cargo 
cults and other ritual activity. 

Chinese 

Identifying someone in Indonesia as a member of the Chinese 
(Tionghoa) ethnic group is not an easy matter, because the physical 
characteristics, languages, names, areas of residence, and lifestyles 
of Chinese Indonesians are not always distinct from those of the rest 
of the population. The national census does not record the Chinese as 
a special group, and there are no simple racial criteria for member- 
ship in this group. There are some people who consider themselves 
Chinese but who, as a result of intermarriage with the local popula- 
tion, are less than one-quarter Chinese in ancestry. On the other 
hand, there are some people who by ancestry could be considered 
half-Chinese or more but who regard themselves as fully Indonesian. 
Furthermore, many people who identify themselves as Chinese Indo- 
nesians cannot read or write the Chinese language. 

The policy of the Indonesian government by the early 1990s 
strongly advocated the assimilation of the Chinese population into 
the communities in which they lived, but the Chinese had a long his- 
tory of enforced separation from their non-Chinese neighbors. For 
nearly a century prior to 1919, Chinese were forced to live in sepa- 
rate urban neighborhoods and could travel out of them only with 
government permits. Most Chinese continued to settle in urban areas 
of Indonesia even after this "quarter system" was discontinued in 
1919. In some areas, such as the city of Pontianak in Kalimantan 
Barat and Bagansiapiapi in Riau Province, Chinese even came to 
form a majority of the population. They began to settle in rural areas 
of Java in the 1920s and 1930s, but in the 1960s the government 
again prohibited the Chinese from exercising free choice of resi- 
dence, requiring them to live in cities and towns. 

The Chinese who immigrated to Indonesia were not linguistically 
homogeneous. The dominant languages among these immigrants 
were Hokkien, Hakka, and Cantonese. There was great occupational 



148 



Papuan men, 
Papua Province 
Courtesy Embassy of 
Indonesia, Washington, DC 




diversity among the Chinese in the late nineteenth and early twentieth 
centuries, but Dutch colonial policies channeled them into trade, min- 
ing, or skilled artisanship. In the twenty-first century, Chinese con- 
tinue to dominate the Indonesian economy's private sector, despite 
central government policies designed to promote non-Chinese entre- 
preneurs. Nonetheless, Chinese are not a monolithic group. Not all are 
rich and urban. They seldom share a common language besides Indo- 
nesian or Javanese. One of the historical distinctions among Indone- 
sian Chinese in the 1960s and 1970s — between the peranakan (local- 
born Chinese with some Indonesian ancestry) and totok (full-blooded 
Chinese, usually foreign-born) — has begun to fade as fewer foreign- 
born Chinese immigrate to Indonesia. Although the distinctiveness 
and social significance of this division vary considerably from place 
to place in the archipelago, ties to the Chinese homeland are weaker 
within the peranakan community, and there is stronger evidence of 
Indonesian influence. Unlike the more strictly male-dominated totok, 
peranakan families recognize descent along both female and male 
lines. Peranakan are more likely to have converted to Christianity 
(although some became Muslims) and to have assimilated in other 
ways to the norms of Indonesian culture. They typically speak Bahasa 
Indonesia as their first language. 



149 



Indonesia: A Country Study 

The Suharto government's program of assimilation for the Chi- 
nese began to be phased out in 1998. Long-discouraged symbols of 
Chinese identity such as Chinese-language newspapers, schools, and 
public rituals, and the use of Chinese names, are no longer subject to 
strict regulation. During the Suharto years, nearly all Chinese Indo- 
nesians obtained Indonesian citizenship, often at high cost and as a 
result of considerable government pressure. 

Popular resentment persisted toward Chinese economic success, 
however, and nurtured a perception of Chinese complicity in the 
Suharto regime's corruption/ In May 1998, riots broke out in which 
hundreds of Chinese stores were burned and Chinese women were 
raped and murdered. When many Chinese Indonesians fled the vio- 
lence, the subsequent capital flight resulted in further economic hard- 
ship in a country already suffering a financial crisis. By 2005 many 
had returned, but the economic and social confidence of many Chi- 
nese in the country was badly shaken by the experience. 

Education 

The character of Indonesia's education system reflects the country's 
diverse religious heritage, its struggle for a national identity, and the 
challenge of resource allocation in a poor but developing archipelagic 
nation with a population that is young (median age 27.6 years) and 
growing (at an estimated annual rate of about 1.1 percent) in 2009. 
Tremendous progress has been made toward the goal of universal edu- 
cation since 1973, when nearly 20 percent of youth were illiterate. At 
that time, then-President Suharto issued an order to set aside portions 
of oil revenues for the construction of new primary schools. This act 
resulted in the construction or repair of nearly 40,000 primary-school 
facilities by the late 1980s, and literacy rates improved significantly 
nationwide. During 1997-98, the financial crisis affected the poorest 
families the most, resulting in their selectively cutting back on their 
education expenditures. Government funding struggled to keep up 
with rising costs during this period, but by 2002, according to the 
World Bank, only 2 percent of those between the ages of 15 and 24 
could not read, and by 2009, the adult literacy rate was 90.4 percent. 

Primary and Secondary Education 

Indonesians are required to attend nine years of school. They can 
choose between state-run, nonsectarian public schools supervised by 
the Department of National Education (Depdiknas) or private or semi- 
private religious (usually Islamic) schools supervised and financed by 
the Department of Religious Affairs. However, although 86.1 percent 



150 



The Society and Its Environment 



of the Indonesian population is registered as Muslim, according to the 
2000 census only 15 percent of school-age individuals attended reli- 
gious schools. Overall enrollment figures are slightly higher for girls 
than boys and much higher in Java than the rest of Indonesia. 

A central goal of the national education system is not merely to 
impart secular wisdom about the world but also to instruct children 
in the principles of participation in the modern nation-state, its 
bureaucracies, and its moral and ideological foundations. Beginning 
under Guided Democracy (1959-65) and strengthened in the New 
Order after 1975, a key feature of the national curriculum — as was 
the case for other national institutions — has been instruction in the 
Pancasila. Children age six and older learned by rote its five princi- 
ples — belief in one God, humanitarianism, national unity, democ- 
racy, and social justice — and were instructed daily to apply the 
meanings of this key national symbol to their lives. But with the end 
of the New Order in 1998 and the beginning of the campaign to 
decentralize the national government, provincial and district-level 
administrators obtained increasing autonomy in determining the 
content of schooling, and Pancasila began to play a diminishing role 
in the curriculum. 

A style of pedagogy prevails inside public-school classrooms that 
emphasizes rote learning and deference to the authority of the teacher. 
Although the youngest children are sometimes allowed to use the 
local language, by the third year of primary school nearly all instruc- 
tion is conducted in Bahasa Indonesia. Teachers customarily do not 
ask questions of individual students; rather, a standard teaching tech- 
nique is to narrate a historical event or to describe a mathematical 
problem, pausing at key junctures to allow the students to call out 
responses that "fill in the blanks." By not identifying individual prob- 
lems of students and retaining an emotionally distanced demeanor, 
teachers are said to show themselves to be sabar (patient), which is 
considered admirable behavior. 

After completion of the six-year primary- school program, three 
years of junior secondary school may be followed by three years of 
senior secondary school; or students can choose among a variety of 
vocational and pre -professional junior and senior secondary schools, 
each level of which requires three years of study. After secondary 
school, students may choose either three years of postsecondary 
vocational and pre-professional schools or three years of high school. 
There are academic and vocational junior high schools that lead to 
senior-level diplomas. There are also "domestic science" junior high 
schools for girls. At the senior high school level, three-year agricul- 
tural, veterinary, and forestry schools are open to students who have 



151 



Indonesia: A Country Study 

graduated from an academic junior high school. Special schools at the 
junior and senior levels teach hotel management, legal clerking, plas- 
tic arts, and music. 

The completion rate for Indonesian primary schools is excellent. 
Indeed, 100 percent of the relevant age-group had completed primary 
education as of 2003, according to World Bank data. The gross enroll- 
ment rate for primary schools was 100 percent, but it decreased to 62 
percent for secondary schools and 16 percent for postsecondary 
schools. There were nearly equal numbers of girls and boys in primary 
and secondary schools; in the late 2000s, the ratio was 96.7 girls to 
100 boys. Depdiknas reported that in school year 2007-8 there were 
63,444 kindergartens, with a total enrollment of 2.8 million pupils and 
176,061 teachers. Later statistics are available for primary and second- 
ary levels for school year 2008-9. They indicate that there were 
144,228 primary schools, with a total enrollment of 26.9 million stu- 
dents and 1.5 million teachers; 28,777 junior secondary schools, with 
a total enrollment of 8.9 million students and 629,036 teachers; 10,762 
general senior secondary schools, with a total enrollment of 3.8 mil- 
lion students and 314,389 teachers; and 7,592 vocational senior sec- 
ondary schools, with a total enrollment of 3 million students and 
246,018 teachers. Additionally, there were 1,686 special education 
schools from kindergarten to senior secondary levels, with a total 
enrollment of 73,322 and 18,047 teachers. 

Teacher-training programs are varied and gradually being 
upgraded. For example, in the 1950s anyone completing a teacher- 
training program at the junior high school level could obtain a 
teacher's certificate. Since the 1970s, however, primary- school teach- 
ers have been required to have graduated from a senior high school for 
teachers, and teachers of higher grades have been required to have 
completed a university-level education course. Remuneration for pri- 
mary- and secondary-school teachers, although low, compares favor- 
ably with that in other Asian countries such as Malaysia, India, and 
Thailand. Student-teacher ratios also compare satisfactorily with those 
in many Asian nations: They were 23.4 to 1 and 18.8 to 1, respec- 
tively, for primary and secondary schools in 2004; that same year, the 
overall averages for Asia-Pacific countries were 22 to 1 and 1 8 to 1 , 
respectively. 

By 2008 the staff shortage in Indonesia's schools was no longer as 
acute as in the 1980s, but serious difficulties remain, particularly in 
the areas of teacher salaries, teacher certification, and finding quali- 
fied personnel. In many remote areas of the Outer Islands, in particu- 
lar, there is a severe shortage of qualified teachers, and some villages 
have school buildings but no teachers, books, or supplies. Providing 



152 



Elementary school children on Madura, Jawa Timur Province 
Courtesy Florence Lamoureux, used with permission 
© Center for Southeast Asian Studies, University of Hawai 'i 

textbooks and other school equipment to Indonesia's 37 million 
schoolchildren throughout the far-flung archipelago continues to be 
a significant problem as well, especially in more remote areas. 

Islamic Schools 

The secular and nationalist emphasis in public schools has been 
resisted by some of the Muslim majority. A distinct and vocal minority 
of these Muslims prefer to place their children in a pesantren, or 
Islamic school. Usually located in rural areas and directed by a Muslim 
scholar, pesantren are attended by young people seeking a detailed 
understanding of the Quran, the Arabic language, the sharia, and Mus- 
lim traditions and history, as well as more modern subjects such as 
English, mathematics, and geography. Students can enter and leave the 
pesantren any time of the year, and the studies are not organized as a 
progression of courses leading to graduation. Although the chief aim 
of pesantren is to produce good Muslims, they do not share a single 
stance toward Islam or a position on secularism. Some pesantren 
emphasize the autonomy of modern students to think for themselves 
and to interpret scripture and modern knowledge in a way that is con- 
sistent with the teachings of Islam. Others are more traditional and 



153 



Indonesia: A Country Study 

stress the importance of following the wisdom of elders, including 
their teachings on science, religion, and family life. Although the ter- 
rorist bombings in Kuta, Bali, in 2002 raised suspicions about whether 
pesantren promote extremist views, the majority of these schools in 
Indonesia are theologically moderate, reflecting the views of the Indo- 
nesian population as a whole. For those who opt for a pesantren educa- 
tion, a sixth-grade equivalency certificate is available after successful 
completion of a state test. 

In order for students to adapt to life in the modern nation-state, in 
the 1970s the Muslim-dominated Department of Religion (now the 
Department of Religious Affairs) advocated the spread of a newer 
variety of Muslim school, the madrassa. This kind of school inte- 
grates religious subjects from the pesantren with secular subjects 
from the Western-style public-education system. Although in general 
the public believes that Islamic schools offer lower-quality education, 
among Islamic schools a madrassa is ranked lower than a pesantren. 

Higher Education 

Indonesia's institutions of higher education have experienced dra- 
matic growth since independence. In 1950 there were 10 institutions 
of higher learning with a total of about 6,500 students. In 1970, 450 
private and state institutions enrolled about 237,000 students, and by 
1990 there were 900 institutions with about 141,000 teachers and 
nearly 1.5 million students. By 2009 there were 2,975 institutions of 
higher education and more than 4.2 million students. Of these institu- 
tions, 3 percent were public, with 57.1 percent of the student enroll- 
ment, and 97 percent were private, with 42.9 of the student enrollment. 
Even though government subsidies finance approximately 80 to 90 
percent of state-university budgets, universities have considerably 
more autonomy in curriculum and internal structure than primary and 
secondary schools. Whereas tuition in such state institutions is more 
affordable for average students than private-university tuition, faculty 
salaries are low by international standards. Lecturers often have other 
jobs outside the university to supplement their wages. 

Private universities are generally operated by foundations. Unlike 
state universities, private institutions have budgets that are almost 
entirely tuition-driven. A onetime registration fee (which can be 
quite high) is determined at the time of entry. If a university has a 
religious affiliation, it can cover some of its costs with donations or 
grants from international religious organizations. The government 
provides only limited scholarship support for students wishing to 
attend private universities. 



154 



Muslim girls in school uniforms, Madura, Jawa Timur Province 
Courtesy Florence Lamoureux, used with permission 
© Center for Southeast Asian Studies, University of Hawai 7 

Indonesian institutions of higher education offer a wide range of 
programs. However, about 52 percent of all non-teacher-training stu- 
dents enrolled in higher education were social sciences majors in the 
2008-9 academic year, while only 3 percent majored in laboratory- 
intensive fields of study, largely because universities prefer to offer 
social science courses that do not require expensive laboratories and 
equipment. The major academic degree programs are the sarjana 
(literally "scholar," roughly corresponding to a bachelor's degree) 
and the pasca sarjana (master's or doctoral degree). Professional 
schools offer "diploma" and "specialist" degrees, the latter graded 
either "SP1" or "SP2," depending on the level of advancement. From 
2001 to 2004, the number of students completing their sarjana 
degrees grew dramatically from about 308,000 in 2001 to nearly 
683,000 in 2004, a 122-percent increase. This level stood at 652,364 
graduates at the end of academic year 2008-9. 

Discussion about how to improve Indonesian higher education 
focuses on the issues of teacher salaries, laboratory and research 
facilities, and professors' qualifications. Only 7 percent of university 
faculty overall held a Ph.D. in the mid-2000s, although the propor- 
tion was greater (11 percent) in state institutions. Because doctoral 



155 



Indonesia: A Country Study 

programs are few in Indonesia and there is little money to support 
education overseas, this situation is improving only slowly. Despite 
these difficulties, most institutions of higher education receive large 
numbers of applications; in state institutions, less than one in four 
applications was accepted in 2004; in private institutions, the accep- 
tance rate was nearly two out of three. One of the most serious prob- 
lems for graduates with advanced degrees, however, is finding 
employment suited to their newly acquired education. In 2003 the 
unemployment rate for college graduates with the sarjana degree 
was approximately 20 percent, and 10 percent for graduates of pro- 
fessional schools. 

The Republic of Indonesia Institute for Higher Education (BPTRI) 
was founded in Jakarta shortly after independence was declared in 
1945. When the Dutch returned in force, BPTRI dispersed its various 
schools to other parts of Java. The Dutch established Nood Univer- 
siteit (Emergency University) in Jakarta in 1946, and the following 
year changed its name to Universiteit van Indonesie (UVI), or Uni- 
versity of Indonesia. On February 2, 1950, in the wake of the war for 
independence, the government established a state university in 
Jakarta called Universiteit Indonesia. It was composed of units of 
BPTRI and UVI; the name Universiteit Indonesia was later changed 
to Universitas Indonesia. This institution enrolls about 37,000 stu- 
dents per year. Universitas Gadjah Mada lays claim to being the old- 
est Indonesian university. It was founded in Yogyakarta on December 
9, 1949, but was giving its first lectures in early 1946 (when Yogya- 
karta was the Republican capital). State-owned Gadjah Mada has an 
annual enrollment of about 54,000 students. Other major universities 
include Catholic University and the Institut Teknologi Bandung, both 
in Bandung; and the Institut Pertanian Bogor, in Bogor. There also are 
important regional universities in Sulawesi Selatan, Sumatera Utara, 
Jawa Barat, and Papua. Approximately 15 percent of Indonesia's stu- 
dents of higher education attend a public or private Islamic university, 
institute, academy, or polytechnic institute. Among these is the State 
Muslim University (UIN) — formerly called the State Institute for 
Islamic Religion (IAIN) — which has been an important venue for 
progressive debates about Islam. 

Health 

Services and Infrastructure 

As access to education has improved throughout the archipelago, 
use of modern forms of health care also has increased. For example, in 
2003 the United Nations Children's Fund (UNICEF) reported that 68 



156 



The Society and Its Environment 



percent of births in Indonesia were attended by a trained midwife or 
other health specialist. Recent studies show a correlation between the 
rise of education levels and the increased use of hospitals, physicians, 
and other health resources. Indeed, since the 1980s, health in Indone- 
sia has shown overall improvement. Life expectancy was estimated at 

70.8 years in 2009, a substantial increase since 1980, when it stood at 

52.9 years. However, the distribution of improvements, like the distri- 
bution of resources for health maintenance and improvement, has been 
unequal. In 2003 life expectancy was 72 years in Jakarta and Yogya- 
karta but only 63 years in Nusa Tenggara Barat Province. Whereas 
infant mortality nationwide decreased from an average of 105.0 deaths 
per 1,000 live births in 1980 to 75.2 in 1990, to 36.0 in 2000, and to an 
estimated 29.9 in 2009, local rates varied dramatically. The poor, rural, 
and less-educated classes generally suffered much higher mortality 
rates than their educated urban counterparts. 

Community and preventive health programs form another compo- 
nent of Indonesia's health system. Established in 1969 as part of the 
first Repelita (see Glossary), the government's five-year economic 
development plan, community health services are organized in a 
three-tier system with puskesmas (community health centers) at the 
top. Usually staffed by a physician, these centers provide maternal 
and child health care, general outpatient curative and preventive 
health care, pre- and postnatal care, immunization, and communica- 
ble disease-control programs. Specialized clinic services are period- 
ically available at some of the larger clinics. 

Second-level community health centers include subpuskesmas 
(community health subcenters) consisting of small clinics and mater- 
nal and child health centers staffed with one to three nurses and vis- 
ited weekly or monthly by a physician. Toward the middle of the first 
decade of the twenty-first century, the World Health Organization 
(WHO) reported that there were 3.6 health centers per 100,000 popu- 
lation. Since the early 1990s, the Department of Health planned to 
have three to four subcenters per health center, depending on the 
region, and this plan has been largely realized in the twenty-first cen- 
tury. The third level of community health services consists of village- 
level posyandu (integrated service posts). These posts are not perma- 
nently staffed facilities but rather monthly clinics on rented premises, 
in which a visiting team from the regional health center supports 
local health volunteers. 

The distribution of Indonesian health-care workers is also highly 
uneven. To alleviate the problem of physician maldistribution, the 
government requires two to five years of public service by all gradu- 
ates of medical schools, whether public or private. In order to be 



157 



Indonesia: A Country Study 

admitted for specialist training, physicians first have to complete this 
service, which is normally fulfilled by staffing puskesmas. Only two 
years of public service are required for those physicians working in 
remote areas such as the provinces of Nusa Tenggara Timur, 
Sulawesi Tenggara, Kalimantan Timur, Maluku, Papua, and Papua 
Barat, whereas three to five years of service are required for a post- 
ing in Java, Bali, or Sumatra. Despite such requirements, it is diffi- 
cult to attract medical-school graduates to these remote, understaffed 
regions, particularly without additional cash incentives. With an 
average of only about 0.1 physicians, 0.8 nurses or midwives, and 
0.6 hospital beds per 1,000 population, Indonesia compares unfavor- 
ably with all of its Southeast Asian neighbors. 

Government Support 

One of the most notable features of Indonesia's health-care system, 
in comparison with those of other Southeast Asian nations, is the low 
level of government support. For example, in 2006 the Philippines 
expended 3.3 percent of its gross domestic product (GDP — see Glos- 
sary) on health care, Malaysia 4.3 percent, Singapore 3.4 percent, and 
Timor-Leste 16.4 percent. That same year, only 2.2 percent of the 
GDP of Indonesia was devoted to health care, far less than the 5 per- 
cent recommended by the WHO. Of these percentages, however, as 
of 2006, the Indonesian government provided 50.4 percent of the 
total national expenditure on health care. This compares favorably 
with Malaysia's 45.2 percent, Philippines' 39.6 percent, and Singa- 
pore's 33.6 percent but not with Timor-Leste 's 88.8 percent. 

The modern health-care system continues the Dutch colonial pat- 
tern of low levels of investment in health care. The Dutch did rela- 
tively little in the field of public health prior to 1910, with the 
exception of giving smallpox vaccinations. In the 1930s, however, 
the government devoted increased attention to health education and 
disease prevention, particularly in rural areas. An elaborate public- 
health infrastructure had developed by 1939, including a particularly 
sophisticated model program in Purwokerto in central Java. But this 
public-health system collapsed after the Japanese invasion in 1942. 
During World War II, the mortality rate rose dramatically, and the 
general health situation of the country deteriorated. 

In the postwar period, a network of maternal and child health cen- 
ters was established, but resources were extremely limited, with just 
one physician for every 100,000 people. The first dramatic improve- 
ments resulted from the establishment of the network of community 
health centers in 1969. Although at first the general population 
strongly resisted using these facilities, by the time of the 1980 cen- 
sus, 40 percent of people reporting illness in the prior week had 



158 



The Society and Its Environment 



sought treatment at one. By 2005 the community health centers 
catered largely to the rural and urban poor, and most urban residents 
who could afford to do so sought health care from private physicians 
and clinics. 

Traditional and Modern Health Practices 

Dukun — traditional healers — continue to play an important role in 
health care, particularly in rural areas. Often, the services of a dukun 
are used in conjunction with Western-style medicine. In some rural 
areas, these healers represent a treatment option of first resort, espe- 
cially when there is no community health center nearby, or if the only 
modern health care available is expensive, or the facility is under- 
staffed. Ideas about healing differ greatly among the hundreds of eth- 
nic groups, but often healers use extensive knowledge of herbal 
medicines and invoke supernatural legitimacy for their practice. 

Following childbirth, women in many parts of the archipelago 
engage in "roasting." Although different ethnic groups have differ- 
ent explanations for the practice, it usually involves the seclusion of 
the mother and her child for a period following childbirth — from a 
few weeks to months — so that she might submit herself to prolonged 
exposure to the warmth of a hearth or other source of heat. In gen- 
eral, it is believed that this speeds the process of recovery, but many 
believe it helps replace a woman's lost blood, returns her body to a 
trim and fit shape, and helps "dry her out." 

Major Health Problems 

The major cause of death in Indonesia is from communicable dis- 
eases, mainly resulting from a lack of clean water. Tuberculosis is 
the second-leading cause of death and the first among infectious dis- 
eases. Malaria also is a major public-health problem, as are seasonal 
episodes of dengue hemorrhagic fever in both urban and rural areas, 
according to the WHO. 

Human immunodeficiency virus/acquired immune deficiency syn- 
drome (HIV/ AIDS) poses a major public-health threat in Indonesia. 
Although in an April 1992 report the Department of Health reported 
only 47 documented cases of individuals whose blood tested positive 
for HIV, by 2007 there were an estimated 270,000 people living with 
HIV/AIDS, the highest rate among its neighbors and third highest in 
Southeast Asia. Indonesia's estimated 8,700 deaths from HIV/ AIDS 
by 2007 also placed it far above the figures for any of its neighbors 
and fourth highest in Southeast Asia. The rate of infection is particu- 
larly high in Papua. The Ford Foundation and the U.S. Agency for 
International Development have funded HIV/ AIDS prevention and 



159 



Indonesia: A Country Study 

awareness programs in Bali and Papua, and Family Health Interna- 
tional was operating a program, Aksi Stop AIDS (ASA), in many 
parts of the archipelago in 2009. 

Two other important public-health concerns are avian influenza 
and polio. The first outbreak of H5N1 avian influenza in Indonesia 
occurred in 2004, when cases in poultry were reported in 1 1 prov- 
inces. In 2005 the Department of Health reported that a 38-year-old 
man who had died on July 12 was the country's first laboratory-con- 
firmed positive human case of H5N1 avian influenza. By the end of 
the year, 19 more cases had 'been confirmed. By January 2009, Indo- 
nesia had confirmed 140 cases of avian influenza in humans in vari- 
ous parts of the country. The Department of Health, working with the 
WHO, presents seminars and workshops with the goal of strengthen- 
ing surveillance of influenza-like illness, outbreak investigation, and 
appropriate isolation and barrier nursing. The National Committee for 
Avian Influenza Control and Pandemic Influenza Preparedness 
(Komnas FPBI) coordinates the Indonesian government response to 
the H5N1 avian influenza virus. Stockpiling of personal protective 
equipment to protect the health of veterinary workers, as well as the 
general health, and procurement of antivirals for treatment and pro- 
phylaxis, as appropriate, are continuing. Prevention guidelines for the 
general Indonesian community emphasize practices such as frequent 
hand washing, avoidance of contact with sick animals, and safe and 
hygienic handling and cooking of poultry. Although some mass cull- 
ings have taken place in Indonesia, they have not been as extensive as 
in other countries. Although there were more than 1,800 deaths in 
Southeast Asia as a result of the 2009 pandemic influenza H1N1, 
Indonesia was largely spared. Only a few fatal cases were reported in 
Kalimantan by the end of 2009. To confront the threat of the H1N1 
pandemic, Komnas FPBI established an H1N1 Command Post at the 
Office of the Coordinating Minister of People's Welfare. As of July 
2005, there were 122 polio cases confirmed in Indonesia, primarily in 
Jawa Barat and Jawa Tengah, and in Sumatra. Two emergency vacci- 
nation campaigns were conducted by the government in May and 
June 2005. 

Pharmaceuticals 

Indonesia achieved self-sufficiency in basic pharmaceutical pro- 
duction by the early 1990s, but as the twenty-first century began, 
Indonesians still had one of the lowest per capita expenditures for 
modern drugs among the members of the Association of Southeast 
Asian Nations (ASEAN — see Glossary). According to one estimate 
in 2000, Indonesia's annual consumption of medicine was US$4 per 



160 



The Society and Its Environment 



capita, compared to US$6 in the Philippines and US$11 in Thailand 
and Malaysia. Many Indonesians continue to rely at least partially on 
traditional herbal medicines, in part because modern pharmaceuti- 
cals are expensive. When modern medicines are used, ongoing prob- 
lems include overprescription of antibiotics, overuse of injections, 
poor patient compliance, use of unlabeled drugs, and inattention to 
drug interactions. By 2005 Indonesia had about 200 pharmaceutical 
companies and nearly 1,000 pharmaceutical wholesalers. Most were 
located on Java. 

Public Sanitation 

In 2008 about 89 percent of the urban population in Indonesia had 
access to clean water, and about 60 percent had access to piped 
water, mostly from a shared faucet. The number of urban dwellers 
with a household connection rose between 1990 and 2008, from 28 
percent to 37 percent. In rural areas, the proportions were smaller: 
approximately 71 percent had access to an improved water source, 
and about 8 percent had a household connection in 2008. Many mid- 
dle- and lower-class Indonesians continue to rely on the country's 
frequently polluted streams, canals, and water catchment areas. In 
many coastal cities, the freshwater table is being threatened by the 
drilling of private wells, which become contaminated by leaking 
septic tanks. This situation has given rise to the popularity of com- 
mercially purified water sold in sealed plastic containers. 

According to the WHO, 82 percent of urban residents and 54 per- 
cent of rural residents had access to modern sanitation facilities in 
2007, but only 67 percent and 36 percent, respectively, used these 
improved facilities in 2008. Even in urban areas, the WHO estimated 
that 16 percent of residents were without proper sanitation. Many 
commercial and residential areas are served by a waterborne sewerage 
system of open drainage canals discharging raw wastes directly into 
rivers or the sea. In the slum areas of Jakarta, residents are subjected 
to frequent flooding and the outbreak of waterborne diseases resulting 
from clogged sewers. 

Society's Prospects 

As the world's largest archipelago, and fourth most populous 
country, the diverse nation of Indonesia faces environmental and 
social challenges of breathtaking scope. While improved access to 
education has resulted in lower birthrates, rising incomes, better 
health, and greater levels of political participation, it has also come at 
a severe cost to the environment. The preservation of the country's 



161 



Indonesia: A Country Study 

rich ethnic, linguistic, and ecological diversity must increasingly be 
negotiated in relation to the homogenizing influences of the ever 
more integrated and interconnected national and international econo- 
mies. Achieving a sustainable balance among these interests will be 
one of the central challenges facing Indonesia in the coming decades. 

* * * 

Several sources give a broad, useful perspective on the cultures of 
Indonesia. The Potent Dead: Ancestors, Saints and Heroes in Con- 
temporary Indonesia, edited by Henri Chambert-Loir and Anthony 
Reid, has several good articles on the role of religion in Indonesia. 
Andrew Beatty's Varieties of Javanese Religion: An Anthropological 
Account provides a useful analysis of varieties of Muslim practice in 
Java. Martin Ramstedt's volume, Hinduism in Modern Indonesia: A 
Minority Religion Between Local, National, and Global Interests, 
contains several useful essays, particularly his introductory article. 
The contributors to Chinese Indonesians: State Policy, Monoculture, 
and Multiculturalism, edited by Leo A. Suryadinata, discuss the evo- 
lution of state policies toward the religion and culture of Chinese 
Indonesians. A good survey of history, beliefs, and practices associ- 
ated with sex and gender in Indonesia can be found in Fantasizing 
the Feminine in Indonesia, edited by Laurie Sears. Diane Wolf's 
Factory Daughters: Gender, Household Dynamics, and Rural Indus- 
trialization in Java provides a particularly useful analysis of a signif- 
icant aspect of economic growth in Indonesia. Freek Colombijn and 
J. Thomas Lindblad place Indonesia's unrest in historical and cul- 
tural context in Roots of Violence in Indonesia: Contemporary Vio- 
lence in Historical Perspective. James N. Sneddon's The Indonesian 
Language provides a survey of its subject's history and role in con- 
temporary society. Christopher Bjork's Indonesian Education pro- 
vides a contemporary picture of the struggle among teachers, 
schools, and the central educational bureaucracy. A particularly use- 
ful compilation of current essays pertaining to recent violence, polit- 
ical and religious developments, and environmental problems is 
contained in John McDougall's Indonesia Publications: Online Uni- 
versity Course. 

For a description of the history behind current environmental 
debates, Environmental Challenges in South-east Asia, edited by Vic- 
tor King, is the best source. A demographic perspective on population 
growth, health, labor, and migration is the focus of The Demographic 
Dimension in Indonesian Development, by Graeme Hugo et al. (For 
further information and complete citations, see Bibliography.) 



162 



Chapter 3. The Economy 



Perahu pinisi — indigenous trading vessels — moored in Jakarta s old harbor 
ofSunda Kelepa 



THE INDONESIAN ECONOMY, BY MANY MEASURES, pros- 
pered during the New Order government of President Suharto, whose 
long tenure, from 1966 to 1998, both began and ended in political and 
social upheaval. Rapid growth of Indonesia's gross domestic product 
(GDP — see Glossary) endured over a long period of time, signifi- 
cantly raising the standard of living. Social achievements under the 
New Order are widely considered to have been far less impressive, 
however. The most urgent challenge facing Suharto's four immediate 
successors, who took office between 1998 and 2004, was to reignite 
the fast-paced economic expansion of the New Order years. 

The role of government has been absolutely crucial in the shaping of 
economic development in Indonesia since the 1960s. The main themes 
of government economic policy during the latter part of the Suharto 
period were liberalization and deregulation, which in the 1980s and 
1990s radically changed the economic landscape as well as the relation- 
ship between private capital and political power. The financial crisis 
that started in Thailand in the summer of 1997 soon reached Indone- 
sia — and other Asian nations — and crisis management with interna- 
tional assistance became the most pressing topic of economic policy in 
Jakarta over the next several years. In the early years of the new cen- 
tury, the government started putting economic reforms in place. Among 
other new policies, these reforms included a far-reaching decentraliza- 
tion of economic authority and policy making. Central government 
finance and the execution of monetary and exchange-rate policies now 
drew special attention. A resumption of economic growth, though not 
at the same torrid pace experienced prior to the 1997 crisis, accompa- 
nied the implementation of the reforms. 

Three trends characterize the changes that have occurred in the Indo- 
nesian economy since the late 1960s: increasing integration with the 
world economy, profound structural change, and intense diversifica- 
tion. These trends are highlighted in discussions about major aspects of 
the Indonesian economy, such as international trade, aid, and payments; 
employment and income development; and the main sectors of eco- 
nomic activity. The economy has experienced a fundamental reorienta- 
tion from agriculture to industry, and within the industrial sector itself, 
from oil and gas production to other branches of manufacturing, both 
labor-intensive (for example, textiles and food processing) and capital- 
intensive (for example, chemicals and electrical and electronic goods). 
Modernization has enabled the services sector and the transportation 
and communication infrastructures to make a greater contribution to 



165 



Indonesia: A Country Study 

economic growth. In the early twenty-first century, the national econ- 
omy no longer depends only on natural resources such as oil and gas. 

The Role of Government 

The government pursued policies to support pribumi (see Glos- 
sary) businessmen in the early years of nation building, from inde- 
pendence in 1945 to 1957. These included subsidized credit from the 
state-owned Indonesian People's Bank (BRI — for this and other acro- 
nyms, see table A), and positive discrimination in favor of indigenous 
traders in the allocation of scarce foreign exchange for imports. The 
first five-year development plan (1956-60) proposed a realistic level 
of government investment in physical infrastructure but offered little 
regulation or overall guidance to the private sector. This plan was 
superseded by dramatic developments in the political and economic 
sphere, in particular the takeover of virtually all remaining Dutch- 
owned private enterprises in December 1957, which led to national- 
ization and state control of key sectors of the economy. Indonesian 
civil servants and military officers, most of whom had little manage- 
rial experience, replaced Dutch management personnel. 

The expansion of the state's role in the economy was sustained by 
general policy shifts. The Guided Economy of President Sukarno (in 
office 1945-67) was initiated in a new eight-year development plan 
begun in 1959, which entailed a twelvefold increase in spending on 
government projects without a clear indication of sources of finance. 
By the mid-1960s, credit from Bank Indonesia — the central bank — 
accounted for half of government expenditures. This situation led to 
budget deficits and a mounting foreign debt, as well as galloping 
inflation, which peaked at an annual rate of 900 percent in 1966. In 
spite of a highly visible public building campaign, the economy stag- 
nated, and by 1965 per capita GDP was back at its 1957 level. 

Following the downfall of Sukarno in 1967, the New Order 
regime under Suharto drew upon financial assistance from the Inter- 
national Monetary Fund (IMF) in the pursuit of a variety of emer- 
gency stabilization measures. During the late 1960s, a team of five 
economists from the Faculty of Economics at the Universitas Indo- 
nesia (University of Indonesia) in Jakarta became influential presi- 
dential advisers, even gaining cabinet-level posts. Because three of 
the advisers were graduates of the University of California at Berke- 
ley, the group, led by Widjoyo Nitisastro, who headed the National 
Development Planning Board (Bappenas), became colloquially 
known as the Berkeley Mafia. Foremost among this group's recom- 
mended reforms was a balanced budget, although foreign borrowing 
and aid counted as sources of revenue. In a radical break from the 



166 



The Economy 



socialist tenor of Sukarno's Guided Economy, Suharto's New Order 
heralded a return to private-market development. 

The New Order remained committed to a stable economic envi- 
ronment encouraged by responsible fiscal and monetary policy, but 
concerns over foreign economic dominance, the limited national 
industrial base, and the need for pribumi economic development 
mandated increased government regulation during the 1970s. The 
economy continued to prosper throughout that decade, with GDP 
growing at an average rate of 8 percent annually. In the early 1980s, 
a precipitous drop in the growth rate pointed to limits in the industri- 
alization strategy, and a new generation of reformers advocated a 
more limited role for the government. When the oil market collapsed 
in 1986, the balance was tipped in favor of these advocates of "free- 
fight" economic competition. 

The Political Economy of Reform 

Two main forces of influence within the New Order government 
battled to shape economic policy: the technocrats, favoring market 
reform and little intervention by the government; and the economic 
nationalists, arguing that trade protection and direct government con- 
trol and regulation were necessary. The leaders of the technocrats were 
the original members of the Berkeley Mafia. After Nitisastro, the most 
influential technocrat was Ali Wardhana, initially minister of finance 
and later coordinating minister of economics, finance, and industry. 
Although retired by 1988, both men remained influential behind-the- 
scenes advisers until the early 1990s. Beneficiaries of the tutelage of 
Sumitro Joyohadikusumo, former cabinet member and founding dean 
of the Faculty of Economics at the Universitas Indonesia, these West- 
ern-trained economists were advocates of economic liberalism. 

The economic nationalists included prominent officials in the 
Department of Industry, which was headed by Hartarto; Bacharuddin J. 
(B. J.) Habibie, minister of research and technology, who since child- 
hood had enjoyed Suharto's special protection; and officers on the Cap- 
ital Investment Coordinating Board (BKPM). The balance of power 
between the technocrats and the economic nationalists was for several 
decades mediated by Suharto, but around 1993 the nationalists gained a 
decisive influence over economic policy and increasingly pushed the 
technocrats into the background. This change reflected Suharto's rising 
confidence that he was capable of managing economic development 
without much advice from others, his great trust in Habibie's capacity 
to stage major economic advances, and the rise of his children's busi- 
ness empires in the 1980s and 1990s. 



167 



Indonesia: A Country Study 

The technocrats had initially gained a great deal of credibility by 
curbing rampant inflation and restoring financial stability after the 
New Order government came to power in 1966. As oil revenues 
increased, starting in 1974, government agencies responsible for 
trade and industrial policy sought to extend Indonesia's domestic 
industrial base by investing in basic industries, especially steel man- 
ufacturing, and by erecting trade barriers to protect domestic produc- 
ers from foreign competition. Government regulations proliferated, 
and oil taxes fueled investment in development projects and state 
enterprises. 

The private sector became dominated by large conglomerates, 
often owned by Indonesians of Chinese descent who had sufficient 
wealth and know-how to assist the government with large-scale mod- 
ernization projects. During the 1970s, Chinese Indonesian conglom- 
erates were estimated to account for 75 percent of private-sector 
investment. Around 1990, the top 200 conglomerates accounted for 
sales that taken together corresponded to 25 percent of GDP. Turn- 
over of the five largest, including the Salim and Astra International 
groups, amounted to Rpl6 trillion (US$6.8 billion; for value of the 
rupiah — Rp — see Glossary), and 1 8 of the 22 largest conglomerates 
were owned by Indonesians of Chinese descent. Among them, the top 
200 conglomerates controlled almost 45,000 individual firms. The 
growth of the conglomerates throughout the 1970s and 1980s was in 
most cases highly dependent on political patronage. In exchange for 
monopoly privileges related to production and imports of key indus- 
trial products, conglomerates would undertake large-scale investment 
projects that helped the government reach its industrialization goals. 

By the mid-1980s, about 1,500 items representing 35 percent of 
the value of imports were either imported by licensed importers or 
controlled through a quota system. Nontariff barriers affected virtu- 
ally all manufactured imports but were a particular impediment to 
foreign-made textiles, paper and paper products, and chemical prod- 
ucts. As a result, domestic firms in these lines of production were 
effectively protected from foreign competition or were able to sell 
their products at a higher cost. Firms that obtained import licenses 
were also highly profitable, but costs were borne by the entire econ- 
omy because imports were often key inputs for other manufacturers. 
Popular resentment grew as gains from the restrictions enriched a 
privileged minority and added to a long-standing public sensitivity 
toward the prominent economic position of the Indonesian Chinese 
minority. 

In the 1980s, Suharto's six children came of age and quickly 
became the most visible beneficiaries of direct access to the apex of 
political power. Each of them was connected with one or more con- 



168 



The Economy 



glomerates that based their business success at least partly on lucra- 
tive government contracts. For example, the Bimantara Citra Group, 
run by Suharto's second son, Bambang Trihatmojo, started out by 
selling allocations of imported oil to Pertamina (the State Oil and 
Natural Gas Mining Company, sometimes translated as State Oil 
Company). Around 1990, the business groups of Suharto's children 
were among the foremost non-Chinese conglomerates in Indonesia. 

Examples from two vital industries illustrate the symbiotic rela- 
tionship between government and business in Indonesia. In 1984 
Suharto's long-time personal friend Liem Sioe Liong, founder of the 
Salim Group, agreed to invest US$800 million to expand the opera- 
tions of a government-owned company, Krakatau Steel, in Cilegon, 
Banten Province, by adding production of cold-rolled sheet steel. In 
return, a company partly owned by Liem received a monopoly on 
imports of cold-rolled steel. Once domestic production was under- 
way, Liem's imports were restricted to ensure demand for the Kraka- 
tau product. In a similar way, imports of plastic raw materials were 
monopolized through a government license issued to Panca Holding, 
which had two Suharto sons, Bambang Trihatmojo and Sigit Har- 
joyudanto, on its board of directors. In each case, the price of an 
important commodity for Indonesian users — either steel products or 
plastics — was artificially and significantly raised. 

Oil prices fell from US$25 to US$13 per barrel in 1986, which 
resulted in a 5 -percent decline in national income. Suddenly, there 
was a great need to promote non-oil exports. Meanwhile, dissatisfac- 
tion had been growing over the Suharto administration's trade and 
industrial policies; in particular, local chambers of commerce and 
industry voiced criticism of the "high-cost" economy. Some reforms 
had been in preparation before 1986, but without provisions that 
would directly affect trade restrictions. Major trade deregulation 
began in 1986 but left the main import monopolies untouched until 
1988. This very gradual approach to reform became characteristic of 
the later years of the Suharto regime. The first sector to experience 
reform in the 1980s was finance and banking. 

Financial Reform 

The Suharto administration inherited a system dominated by large 
state banks in which private banking had virtually ceased to exist. 
The New Order government immediately revived the legal founda- 
tion for commercial banking, and by 1983 Indonesia had 81 private 
banks, including 11 foreign or joint- venture institutions. Neverthe- 
less, the banking sector remained highly regulated until the early 
1980s, when the technocrats spearheaded a return to market-led 



169 



Indonesia: A Country Study 

development. Their sweeping reforms were aimed at transforming 
Indonesia's financial sector into a competitive source of credit at mar- 
ket-determined interest rates, with a much greater role for private 
banks and a growing stock exchange. By the 1990s, critics com- 
plained that deregulation had gone too far, introducing excessive risk. 

So-called liquidity credits extended by Bank Indonesia at very 
low interest rates subsidized state bank lending during the 1980s. In 
1983 such credits represented more than half of all state bank lend- 
ing, which in turn made up three-quarters of all bank lending in 
Indonesia. Lending by private commercial banks had been severely 
curtailed, even though such institutions offered better service and 
competitive interest rates on deposits. In addition, Bank Indonesia 
imposed credit quotas on all banks, ostensibly to reduce inflationary 
pressures. In June 1983, credit quotas were lifted, and state banks 
began to offer market-determined interest rates on deposits. Impor- 
tant restrictions remained, however, and by 1988 state banks still 
accounted for almost 70 percent of total bank credit, with liquidity 
credits still constituting one-third of total state bank credit. In Octo- 
ber 1988, further financial deregulation eliminated the remaining 
restrictions on bank competition. 

The number of banks increased as limitations on licenses lifted. In 
1990 there were 103 private banks, including 12 new foreign joint- 
venture banks. The expansion accelerated in the early and mid- 
1990s, and by 1997 Indonesia counted 237 banks, more than Japan. 
These institutions included 203 private commercial banks, 43 of 
which were foreign or joint- venture banks and 34 state banks, 
including 27 that were run by provincial governments. 

Two spectacular bank scandals demonstrated that professional, 
uncorrupted regulation and oversight were sorely needed. In 1990 
Bank Duta, Indonesia's second-largest private bank, had to be bailed 
out after losing more than US$400 million in foreign-exchange deal- 
ings. Bank Indonesia organized a rescue operation with the money 
raised from the shareholders of Bank Duta, including several founda- 
tions chaired by Suharto. In late 1992, Bank Summa found itself in a 
similar predicament, but the government did not come to the rescue, 
possibly because of the honorable public image of the bank's owner, 
William Suryajaya (Tjia Kian Liong), founder of Astra International, 
who had consistently declined to enter into dubious deals with gov- 
ernment agencies. Liquidation of assets for the recovery of losses at 
Bank Summa in fact paved the way for a takeover of Astra Interna- 
tional by a group of Suharto cronies, including Liem Sioe Liong. 

A few idiosyncrasies of Indonesian banking deserve special men- 
tion. One is the option for banks to offer deposits denominated in for- 
eign currency, usually U.S. dollars. This gave rise to the so-called 



170 



Rush-hour traffic in Jakarta 
Courtesy Embassy of Indonesia, Washington, DC 

Jakarta dollar market, and in 1990 Bank Indonesia determined that a 
bank's net foreign position (the difference between foreign assets and 
foreign liabilities) could correspond to as much as 25 percent of the 
bank's total outstanding capital. Also characteristic was the close link 
between banks and conglomerates. Prior to the reforms of 1988, it 
was often the case that a private bank was virtually the financial arm 
of a large conglomerate and only lent money to firms connected with 
the bank's owners. The reforms constrained such loans, although they 
remained difficult to control. In addition, starting in 1990 the govern- 
ment requested that banks lend 20 percent of their loan portfolios to 
small businesses. This policy reflected a growing concern that the 
public might perceive the benefits of economic growth as accruing 
only to the well-connected, wealthy few. 

The Jakarta Stock Exchange, which operated for several years as 
a small and ineffective institution, experienced a spectacular expan- 
sion once various restrictions were lifted in the 1980s. The number 
of listed firms rose from 24 in 1988 to 125 in 1991, and market capi- 
talization (total market value of issued stocks) climbed above Rpl2 
billion (about US$6.2 million). Although market capitalization cor- 
responded to less than 15 percent of total bank credit to private 
firms, the stock market promised to become an important source of 
finance. However, the early 1990s saw extreme swings between 
euphoric expansion and virtual collapse, and at one point in 1991 
one stock brokerage firm was even charged with swindling other 



171 



Indonesia: A Country Study 

brokers by issuing bad checks. The Jakarta Stock Exchange settled 
into a more stable existence in the mid-1990s as the public and bro- 
kers grew more familiar with procedures. (The Jakarta Stock 
Exchange merged with the Surabaya Stock Exchange in 2007 to 
form the new Indonesia Stock Exchange.) 

Deregulation and liberalization of the financial sector led to a 
very rapid enlargement of credit in Indonesia. Total outstanding 
credit by 1997 reached Rp306 trillion (US$105 billion), 80 percent 
of which was denominated in rupiah. Interest rates at domestic banks 
remained high, at around 15 to 16 percent on deposits, which made 
borrowing from foreign banks all the more attractive. 

Industrial and Trade Reform 

Indonesia's industrialization during the 1970s and 1980s occurred 
with many trade restrictions and government regulations that made 
private businesses hostage to government approval or protection. As 
a consequence, almost all of Indonesia's industrial production was 
sold in the domestic market, leaving exports to be dominated by oil 
and agricultural products. Trade policy reforms in the mid-1980s 
proved successful in promoting the growth of new export industries, 
but the large conglomerates were in the best position to benefit from 
the more competitive business environment. The uneven distribution 
of gains from economic growth caused mounting popular dissatis- 
faction by the mid-1990s. 

The Indonesian government favored a strategy of import-substitu- 
tion industrialization that did not expose domestic manufacturing to 
competition in world markets (see Industry, this ch.). This strategy 
was supported by a great variety of barriers to imports: almost 1,500 
nontariff restrictions and tariffs ranging up to 200 percent of the 
value of imported goods. Inefficiencies plagued the import- substitu- 
tion approach, and it offered generous opportunities for corruption. 
Case studies of import substitution in manufacturing showed that it 
generated only 25 percent of the jobs export-oriented production 
would have provided. 

The government initiated trade reforms in May 1986, when duty 
refunds compensated for tariffs paid on goods imported by domestic 
producers that exported a substantial share of their output. A major 
trade reform in November 1988 began the dismantling of the elabo- 
rate nontariff barriers and the simplification and reduction of tariffs. 
The reforms reduced the share of domestic manufacturing protected 
by nontariff barriers from 50 percent in 1986 to 35 percent in 1988. 
By 1990, some 60 percent of nontariff barriers had been abolished, 
and import tariffs had a maximum rate of 40 percent. 



172 



The Economy 



There were important exceptions to the credo of economic liberal- 
ism that accompanied the series of deregulation packages introduced 
between the mid-1980s and mid-1990s. Strict government control 
remained in key sectors, notably natural-resource exploitation, tech- 
nology, and the sensitive area of pribumi entrepreneurship. 

The exploitation of oil and natural gas (marketed in the form of 
liquefied natural gas, or LNG) remained tightly controlled by the 
government through contractual agreements between Pertamina and 
foreign oil companies (see Petroleum and Natural Gas, this ch.). In 
the early 1980s, restrictions also increasingly restricted the logging 
industry, culminating in a total ban on log exports in 1985. This 
strategy, aimed at fostering a domestic plywood and sawmill indus- 
try, proved successful and was later extended to exports of sawn tim- 
ber in order to bolster wood furniture manufacturing. 

Ten state-owned enterprises entrusted with the strategic task of 
raising the level of Indonesia's technological sophistication bene- 
fited from special protection. They included Krakatau Steel and the 
embryonic Archipelago Aircraft Industry (IPTN) and were under the 
direct supervision of the powerful minister of research and technol- 
ogy, Habibie, a talented aircraft engineer. The strategic industries 
enjoyed extrabudgetary funding and were accountable only to the 
president himself. 

In order to counter resentment of the privileges of the conglomer- 
ates, President Suharto urged large corporations to divest part of their 
equity to employee-owned cooperatives on credit supplied by the 
employer and also to sponsor smaller pribumi firms that could serve 
as subcontractors. None of these actions were legally mandated, but 
Suharto made it clear to the Chinese Indonesian tycoons that he 
expected them to comply if they were to continue getting priority 
access to lucrative government contracts. A survey of the Suharto 
family's corporate wealth, published in the Hong Kong-based Far 
Eastern Economic Review in 1992, demonstrated that public resent- 
ment of the ruling elite was growing, although government officials 
and businessmen still declined to voice criticism openly. 

Corruption scandals involving members of the Suharto family prolif- 
erated in the mid-1990s, and there were frequent public outcries of 
indignation. Some of the most notorious cases concerned the president's 
youngest son, Tommy Suharto (Hutomo Mandala Putra). In blatant con- 
tradiction of the prevailing general policies of deregulation, he was 
granted monopoly rights to purchase and distribute cloves needed by 
Indonesia's cigarette industry, and before long his agency obtained large 
credits from state banks, despite outstanding debts to Bank Indonesia. 
Even more infamous was his involvement with the national car industry, 



173 



Indonesia: A Country Study 

set up as a joint venture with the automobile manufacturer Kia of the 
Republic of Korea (South Korea). In 1996 Tommy Suharto's company, 
National Son Timor (TPN), was exempted from payment of import tar- 
iffs when importing South Korean-made sedans that were subsequently 
marketed as a domestic product called the Timor. Because of this fla- 
grant violation of its own trade legislation, the Indonesian government 
was brought before the World Trade Organization (WTO — see Glos- 
sary) by Japanese, U.S., and European car manufacturers operating in 
Indonesia. The Indonesian government predictably lost the case, adding 
to the considerable damage already done to its prestige, both interna- 
tionally and at home. 

In The East Asian Miracle, a, well-known analysis of spectacular 
economic success in East Asia published in 1993, the World Bank 
classified Indonesia as a "high-performing Asian economy," along 
with Hong Kong, Japan, Malaysia, Singapore, South Korea, Taiwan, 
and Thailand. Indonesia's GDP growth had indeed been impressive, 
averaging 5.5 percent annually during the preceding decade (1984- 
93). A growth acceleration occurred in the mid-1990s, with the 
annual average approaching 8 percent over the years 1994-96. 
Exports grew by 8 percent per year, and growth figures were higher 
still in finance, construction, utilities, and various branches of manu- 
facturing. As late as May 1997, only a few months before the Asian 
financial crisis spread to Indonesia, the World Bank, in its annual 
assessment, expressed confidence in the growth prospects and mac- 
roeconomic fundamentals of the Indonesian economy. 

Crisis Management 

No one foresaw that when Bank Indonesia floated the rupiah on 
August 14, 1997, this would be the starting point of a severe finan- 
cial crisis with profound social and political ramifications. The 
downward adjustment in the value of the currency turned into a free 
fall of the exchange rate, a near collapse of the stock market, mas- 
sive capital flight, an abrupt end to growth in almost all sectors of 
the economy, mass layoffs, galloping inflation, and a rapidly increas- 
ing incidence of poverty. In May 1998, riots and political upheaval 
culminated in the downfall of Suharto. The key issues surrounding 
the financial crisis that struck Indonesia relate to the reasons why the 
crisis became so severe and the ways in which crisis management 
was executed. 

There is general agreement among scholars that high rates of 
growth and apparently healthy macroeconomic indicators, notably a 
balanced budget and moderate rates of inflation, masked structural 
weaknesses that made Indonesia highly vulnerable to a financial cri- 



174 



The headquarters of Bank Indonesia, Jakarta 
Courtesy Yadi Jasin 



sis imported from abroad. Such weaknesses included rapidly increas- 
ing private debt, a quasi-fixed exchange rate despite large inflows of 
mobile short-run capital, a poorly supervised banking system that left 
much room for reckless lending and widespread collusion, and cor- 
ruption in the allocation of government contracts. Private external 
debt grew from US$7.5 billion in 1991 to nearly US$58 billion in 
1997, an almost eightfold increase. Much of this debt was short-term 
and lacked hedging in the form of safeguards against fluctuations in 
the exchange rate. Banks and conglomerates tacitly assumed that the 
government would step in and bail them out if they were unable to 
meet their foreign obligations. Such behavior, commonly regarded as 
constituting a "moral hazard," was a characteristic feature of the 
Asian crisis in general, but in the case of Indonesia it was more 
strongly linked than elsewhere to the political economy, in particular 
the nexus between private economic interests and the apex of politi- 
cal power. Corruption and poor governance did not cause the finan- 
cial crisis in Indonesia, but these factors did make the crisis worse. 

Predicaments in the financial sector became acute because short- 
run loans from foreign creditors had to be repaid in international cur- 
rency, whereas revenues were generated from long-run investment 
and denominated in domestic currency. The sharp depreciation of the 
rupiah led to an instant increase in the number of nonperforming 
loans. The government had little choice but to turn to the IMF for 
assistance. From late October 1997 until December 2002, crisis 
management and postcrisis recovery policies were determined by the 
interplay between the IMF and the Indonesian government. 



175 



Indonesia: A Country Study 

The rescue package envisaged a huge standby assistance fund of 
US$38 billion, at the time the largest sum of this kind ever offered by 
the IMF to an individual nation, with disbursement conditional on the 
implementation of specific reforms. The IMF concluded no fewer 
than four consecutive agreements with Indonesia, on October 31, 
1997, and January 15, April 10, and July 29, 1998. The agreements 
required the establishment of facilities for bank and debt restructur- 
ing, prudence in fiscal and monetary policies, and the pursuit of 
deregulation with greater vigor than in the past. However, action fol- 
lowing the first IMF agreement backfired as the closure of 16 ailing 
banks triggered large-scale capital flight that put the rupiah under 
even greater strain than before. Doubts arose about Suharto's com- 
mitment to reform, especially after one of the shuttered institutions, 
Bank Andromeda, owned by his second son, Bambang Trihatmojo, 
reopened under a new name. It took a telephone call from U.S. presi- 
dent William J. Clinton in January 1998 to persuade Suharto to sign a 
second agreement with the IMF, which more forcefully committed 
the Indonesian government to reform and, in particular, did away 
with monopoly privileges such as those enjoyed by Tommy Suharto's 
national car project and B. J. Habibie's aircraft company. The IMF 
also permitted the government to run a deficit, corresponding to 1 
percent of GDP, to allow for aid to the large numbers of people now 
struck by poverty. 

Lack of cooperation on the part of the central authorities contin- 
ued into the first half of 1998, Indonesia's worst year of economic 
crisis, when GDP contracted by an unprecedented 13.7 percent, 
more than during the entire depression of the 1930s. Suharto's selec- 
tion of Habibie as vice president, and the appointment of well- 
known cronies and his own daughter as cabinet ministers, eroded 
confidence in the long-serving president's ability to deliver Indone- 
sia from crisis. The IMF grew alarmed by Suharto's toying with the 
idea of a currency board that would operate on the basis of a fixed 
rate of exchange. This arrangement would have been in direct viola- 
tion of the reform agreements, but the rumor was that it would allow 
the Suharto family to get assets out of the country without serious 
damage to their value. 

The third IMF agreement (April 10, 1998) reiterated the commit- 
ments made in the two previous agreements but raised the permitted 
deficit on the budget to 3.5 percent of GDP and pressed anew for 
determined action by the Indonesian government. By that time, even 
Suharto's most ardent supporters were realizing that the aging presi- 
dent was part of the problem rather than the means for its solution. The 
fourth and final IMF agreement (July 29, 1998) followed Habibie's 



176 



The Economy 



installation as Suharto's successor. The extreme increase in poverty 
necessitated a far larger budget deficit; in fiscal year (FY — see Glos- 
sary) 1999, it would correspond to 8.5 percent of GDP and would be 
financed with a loan provided by an international aid consortium, the 
Consultative Group on Indonesia (CGI — see Glossary; see Govern- 
ment Finance, this ch.). 

Precious time was lost between the onset of the financial crisis in 
August 1997 and the fourth IMF agreement in July 1998. The main 
reason was the Suharto administration's inability to confront the fun- 
damental problems of the crisis. This delay understandably caused 
serious doubts on the part of the IMF, which deferred disbursement of 
the pledged assistance. By July 1998, only a small proportion of the 
huge rescue package had actually been paid out. Cooperation with the 
IMF improved significantly under President Habibie and his two 
immediate successors, Abdurrahman Wahid and Megawati Sukar- 
noputri. Two key members of the Megawati cabinet, Minister of 
Finance Budiono and Coordinating Minister for the Economy Doro- 
jatun Kuncoro-Yakti, were both Western-trained and highly respon- 
sive to IMF recommendations. The IMF also displayed an increasing 
sensitivity to the demands of the specific crisis in Indonesia, notably 
by abandoning the priority of a balanced budget in fiscal policy and 
by recognizing the need for social safety-net programs to protect the 
most vulnerable groups in society from the effects of the crisis. 

Postcrisis Reform 

The most pressing problems of structural reform in the wake of the 
financial crisis fell to two newly established institutions, the Indone- 
sian Bank Restructuring Agency (BPPN, also IBRA) and the Indone- 
sian Debt Restructuring Agency (Indra), established in January and 
July 1998, respectively. The BPPN had the task of taking over assets 
of bankrupt banks and arranging recapitalization of ailing banks. Indra 
focused on corporate debts but was superseded by another agency, the 
so-called Jakarta Initiative, set up jointly by the government and the 
World Bank in September 1998, which smoothed debt settlement 
through bilateral negotiations and debt-equity swapping. As a result, 
the government acquired substantial holdings of assets that were to be 
sold off gradually so as to retroactively finance the debt settlements. 
Privatization became a key strategy of economic policy. 

The BPPN took over 10 private banks in 1998 and 1999, closed 
down another 66, and merged four troubled state banks into one new 
institution, Bank Mandiri, which became the single largest bank in 
Indonesia. In May 1999, the total cost of bailing out and recapitaliz- 
ing troubled banks was estimated at Rp406 trillion (US$51.4 billion). 



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Indonesia: A Country Study 

By 2002 the total amount needed for bailout and recapitalization had 
reached Rp660 trillion (US$70.8 billion). The country then had 179 
banks remaining, 93 of which were scheduled for restructuring, 
including 31 state-owned, 57 joint ventures, and 5 privately owned. 
Progress was slow, however, especially in terms of divesting the 
assets that had been taken over from these institutions. By the time 
the BPPN was dissolved in February 2004, it had recovered 28 per- 
cent of the nominal value of loans it had taken over but had been able 
to return only 25 percent of the value of the bonds the government 
had issued to pay the banks * creditors. Remaining assets, carrying a 
book value of US$8.3 billion, came directly under the auspices of the 
Department of Finance. Assessments of BPPN's performance pointed 
out that it would have been unrealistic to expect the agency to get 
more for assets that had been grossly overvalued in the first place. 

Bank and debt restructuring in the period from 1998 to 2004 suf- 
fered from two problems beyond the strict confines of financial policy 
and management. One problem was in the legal sphere and concerned 
bankruptcy. A 1998 bankruptcy law finally replaced one dating from 
Dutch colonial times, but it still proved very difficult to get debt-rid- 
den firms declared bankrupt. Creditors won very few cases, in a judi- 
cial system widely known to be rife with corruption. The other 
problem concerned the divestment of seized corporate assets. When 
assets were sold off, there was a real risk that the BPPN would come 
across former owners trying to buy back their assets at low prices, 
possibly under other names. Whenever foreign buyers were involved, 
political opposition was likely in the legislature or through pressure 
groups. In 2001 nationalist opposition in Sumatera Barat Province 
successfully blocked the sale of a majority equity share in a state- 
owned cement factory to the Mexican cement giant CEMEX (for- 
merly Cementos Mexicanos). Eventually, CEMEX bought 25 percent 
of the shares, but it expressed a wish to pull out in 2006. 

Good governance became a top priority of postcrisis reform, and 
recent administrations have, in varying degrees, pledged to combat 
corruption and enhance democracy and the transparency of govern- 
ment affairs. One of the most sweeping reforms entailed a far-reaching 
delegation of authority to subnational levels of government (see 
Decentralization, this ch.). Although implementation was quick and 
complete, with maximum involvement of democratic institutions, suc- 
cess was limited, largely because of great variation in the capacity of 
local governments to exercise their authority in taxation and fiscal pol- 
icy. Even though he supported democratic reforms, including arrange- 
ment of Indonesia's first fully free general elections since 1955, 
Habibie enjoyed little credibility, as he himself was the product of a 



178 



The Economy 



corrupt and despised system. A scandal in September 1999 involving 
secret money transfers from the private Bank Bali to the ruling political 
party erased any remaining faith in Habibie's commitment to genuine 
reform. 

Elected to the presidency by the People's Consultative Assembly 
(MPR) in October 1999, Abdurrahman Wahid initially profited from 
much goodwill both at home and abroad, but this support vanished 
as a result of his erratic style of government and lack of tangible 
accomplishments (see The Political Process, ch. 4). Direct adminis- 
trative intervention by the president frequently had unfortunate 
results. For example, in April 2000 Wahid dismissed Laksamana 
Sukardi as minister for investment and state enterprises development 
without offering any clear explanation. Sukardi had an undisputed 
image of integrity and was in fact the first cabinet-level minister to 
expose the way Suharto had abused his power in order to give signif- 
icant favors to his business associates. Shortly afterward, Wahid also 
had the governor of Bank Indonesia, Syahril Sabirin, placed under 
detention out of displeasure with the central bank's independent 
action. Wahid's successor, his vice president, Megawati Sukarnopu- 
tri, had the good fortune of being surrounded by some very capable 
economic advisers. During her presidency, economic recovery pro- 
ceeded reasonably smoothly, but strikingly little was achieved in 
combating corruption, including that in the judicial system. 

Two institutions in particular had a mandate to combat corruption, 
the Corruption Eradication Commission (KPK) and the Corruption 
Crimes Court (Tipikor), both established in 2002 on the recommen- 
dation of the IMF. After a relatively slow start, they became more 
active in 2005. In that year alone, 450 corruption cases were prose- 
cuted, compared with only about 200 during the three years of Mega- 
wati's presidency (2001^). This increase seemed to reflect a genuine 
commitment on the part of Megawati's successor, Susilo Bambang 
Yudhoyono (known colloquially by his initials, SBY), to weed out 
corrupt practices from public administration in Indonesia. Signifi- 
cantly, by early 2006 Yudhoyono had allowed corruption charges to 
be levied against 52 high-ranking government officials at the provin- 
cial and district levels, as well as against seven governors, nine may- 
ors, and 36 district heads. 

The Yudhoyono administration also sought to improve the invest- 
ment climate in Indonesia by presenting a reform package in Febru- 
ary 2006 that included a new investment law, tax incentives, 
facilities for training personnel, and financial aid to small-scale busi- 
ness enterprises. The reform package also proposed the establish- 
ment of eight new special economic zones for export production. At 



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Indonesia: A Country Study 

mid-decade, economic reform policies pursued by the Indonesian 
government seemed to have a new momentum. By 2008, however, 
there was again mounting disappointment with the slow pace of 
reform, especially in local governments, state-owned enterprises, 
and some central government departments. 

Government Finance 

Central Government Budget 

Five-year development plans (Repelita — see Glossary) were an 
important tool in economic planning beginning in the 1960s. These 
plans offered broad guidelines and set general priorities. The empha- 
sis was on rehabilitation in Repelita I (1969-73), but it then shifted to 
increasing productivity in agriculture and improving infrastructure in 
particular during the 1970s. After the drop in oil prices in the early 
and mid-1980s, consecutive Repelitas stressed industrialization and 
export promotion. By the time of Repelita V (1989-93), the main 
objectives included continued export diversification and reduced reli- 
ance on foreign aid. The 1980s and early 1990s also saw increasing 
attention given to social development issues, such as education, 
health, and family planning. Repelita VI (1994-98) stressed the 
expansion of manufacturing and set growth targets that were over- 
taken by actual developments on the eve of the 1997-98 financial cri- 
sis. The government abandoned conventional Repelitas in the wake of 
the crisis and thereafter replaced them with national medium-term 
development plans (NMDPs), also set out in five-year increments. 
The main objectives of the 2004-9 NMDP included a sharp reduction 
in poverty and registered unemployment and an average annual rate of 
growth of 6.6 percent. 

The Repelitas served as general indicators of the direction of gov- 
ernment policy rather than concrete priorities (the latter being pro- 
vided by the annual budget of the central government). Indonesia 
traditionally had a fiscal year that ran from April 1 to March 3 1 , with 
the national government's draft budget for a particular year usually 
submitted to the People's Representative Council (DPR) in January, 
only months before the budget was to become effective (see Legisla- 
tive Bodies, ch. 4). Beginning in 2000, the fiscal year coincided with 
the calendar year, with the budget now sent to the DPR at mid-year. 
As a consequence, the budget for 2000 covered only nine months. 
Public spending historically was divided into two broad categories, 
routine and development expenditures. Routine expenditures included 
the salaries of civil servants and most spending on materials, opera- 
tions, and maintenance, whereas development expenditures consisted 



180 



The Economy 



of project-related spending in areas such as investment, research, and 
training. Over time, however, the line dividing the two categories 
became somewhat arbitrary in practice. Starting with the FY 2005 
budget, the distinction between routine and development expenditure 
was abandoned entirely and replaced by a classification system rec- 
ommended by the IMF that differentiated more carefully between cur- 
rent and capital outlays and among levels of government authority. 
The distinction between spending by the central government and that 
by regional governments has become ever more important since the 
decentralization reforms that followed the collapse of the New Order 
government. 

Since the 1980s, the total government budget has been rather stable, 
about or slightly less than 20 percent of GDP. In 2003 total government 
expenditures amounted to Rp371 trillion (US$43.2 billion), or 19.1 
percent of GDP, against a total revenue of Rp336 trillion (US$39.2 bil- 
lion), or 17.3 percent of GDP. The resulting deficit corresponded to 1.8 
percent of GDP. The 2009 budget envisaged government revenue at 
21.2 percent of GDP and government expenditure at 23.4 percent of 
GDP. Deficit spending has been the exception rather than the rule in 
Indonesian government finance since the late 1960s. Fiscal prudence 
and rapid economic growth resulted in balanced budgets throughout 
the 1980s and early and mid-1990s. Even the initial draft budget for the 
crisis year 1998-99, prepared in mid- 1997, included projection of a 
small surplus, which proved entirely unrealistic. Combating crisis and 
staging economic recovery necessitated deficit spending by the central 
government starting in 1998. The budget deficit rose to 6.8 percent of 
GDP in FY 1999 (12 months) and was 5 percent of GDP in FY 2000 
(nine months). It then fell gradually, reaching 2.5 percent in FY 2002 
and creeping below 1 percent in FY 2005 and FY 2006. The budget for 
FY 2008 displayed a deficit of Rp73 trillion (US$8.1 billion) corre- 
sponding to 1.7 percent of GDP, whereas the one agreed for FY 2009 
showed a slightly higher deficit at 2.2 percent of GDP. 

A bottleneck in central government finance in Indonesia occurs 
because of the heavy reliance on sources of revenue based in the oil 
and gas sector. Taxes paid by foreign oil companies burgeoned during 
the oil boom of the 1970s, raising oil's contribution to total government 
revenue from one-third in 1974 to more than two-thirds by 1979. Even 
in the early 1980s, at least half of government income came from oil- 
related taxes. A major tax reform in 1984 introduced a value-added tax 
(VAT) on consumer goods and a moderately progressive income tax. 
Although 85 percent of households did not earn enough to be subject to 
the income tax, the contribution of non-oil tax revenue did increase sig- 
nificantly, climbing from less than RplO trillion (about US$9 billion) 



181 



Indonesia: A Country Study 

annually in the mid-1980s to almost Rp60 trillion (about US$26 bil- 
lion) by the mid-1990s. As a consequence, revenues from oil and gas 
dropped to 20 percent of total domestic revenue, but the downward 
trend was reversed by the steep decline in incomes during the Asian 
financial crisis. The contribution of oil and gas revenues again rose to 
about 30 percent of total government revenue and oscillated around 
that level in the years immediately following the turn of the century, 
even rising somewhat as a result of high oil prices on the world market 
in 2005 and 2006. Oil and gas contributed 20 percent of total govern- 
ment revenue in the agreed budget for FY 2008. 

The tax-revenue bottleneck has been reflected in a high depen- 
dence on foreign aid and borrowing abroad. Foreign public debt 
increased sharply in the 1980s, approaching US$50 billion by that 
decade's end. In the early 1990s, the government shifted from its tra- 
ditional reliance on long-term public debt to allowing more private 
and short-run lending. The stock of foreign debt declined from about 
80 percent of GDP to less than 60 percent as a result, and also 
because of simultaneous rapid economic growth. On the eve of crisis 
in 1997, Indonesia's public debt amounted to US$58 billion. This 
downward trend was reversed by the crisis, which saw another sharp 
increase in foreign indebtedness, up to more than 100 percent of 
GDP. Foreign funding was vital to finance two-thirds of the deficit 
on the FY 1999 (April 1999-March 2000) budget and half of the 
deficit on the budget for FY 2000 (April-December 2000); the Indo- 
nesian government had little choice. Tax revenues were constrained 
by the real decline in GDP, proceeds from the sale of seized corpo- 
rate assets were slow in coming, and it was next to impossible to cut 
expenditures in the midst of a severe economic crisis. Prior to the 
crisis, routine expenditures usually made up about two-thirds of total 
public spending, but this proportion rose to 85 percent at the time of 
the crisis. The traditional expenditure ratio of roughly two-thirds 
routine and one-third development was restored around 2000, but the 
allocation now needed for debt servicing represented a far heavier 
burden than before. The distribution between routine and develop- 
ment expenditures stabilized at 75 percent for the former and 25 per- 
cent for the latter during the 2002—4 period, preceding the change in 
the system of budgetary classification. 

The budget for FY 2002, in part designed by ministers Budiono 
and Dorojatun of the newly inaugurated Megawati cabinet, may 
serve to illustrate some typical features of public finance in Indone- 
sia that held true for the most part in subsequent years. Tax revenue 
was expected to contribute 73 percent of total government income, 
corresponding to less than 13 percent of GDP, which was low by 



182 



The Economy 



international standards. Most other government revenue was pro- 
jected to derive from the exploitation of oil and natural gas 
resources, an assumption that implied a continued dependence on 
strong world oil prices in government financial planning. Expendi- 
tures, corresponding to 20 percent of GDP, were divided between 
routine and development purposes at a ratio of 78 percent to 22 per- 
cent. The central government assumed responsibility for 72 percent 
and regional governments for 28 percent of total outlays, a ratio that 
testifies to the strong start of the decentralization reforms. Total 
development spending at the central level was set at Rp50 trillion 
(about US$5.3 billion), about 25 percent of which was designated 
for education and culture but only 10 percent for health and welfare. 
The scope for expenditure on social-development projects remained 
severely constrained. Interest payments would make up more than 
25 percent of central government outlays in the FY 2002 budget, 
whereas around 12 percent would go to subsidies on consumption, in 
particular fuel use. Neither expenditure lent itself to easy reduction. 
The interest payments were a legacy of the crisis management of the 
late 1990s, which entailed the buildup of a large public debt, and the 
subsidies were politically untouchable because no administration in 
search of popular support would tamper with a benefit enjoyed by 
large segments of the population. The subsidies on fuel consumption 
were substantially reduced in October 2005 after many years when 
the change was motivated — and justified — by the finding that 80 
percent of this entitlement represented a generous handout to those 
in the top 60 percent of income distribution. Fuel subsidies increased 
again in early 2009, arguably with an eye to the upcoming presiden- 
tial elections. 

Decentralization 

Under Suharto's administration, Indonesia had one of the most 
centralized governments among developing nations. Spending at the 
regional level was highly dependent on transfers of funds from the 
top level of government through a complex system of direct grants 
from both the routine and development budgets, complemented by 
special allocations made at the direction of the president. One legacy 
of the short-lived Habibie administration in the late 1990s was the 
transformation of this arrangement into its virtual opposite, one of 
the most decentralized public-finance systems among the major 
nations of the world. The basis for this far-reaching reform was laid 
down in two laws promulgated in 1999 — Law 22, on regional gov- 
ernment, and Law 25, on the financial balance between the center 
and the regions. Law 22 did away with the hierarchical relationship 



183 



Indonesia: A Country Study 

between the central government and the provinces and regencies. 
The most striking feature of the new system, which took effect in 
January 2001, is that it granted considerable discretionary authority 
in public finance to the regencies and municipalities, which by that 
time numbered 353. The provincial level was virtually bypassed. 
Law 25 enumerates categories of revenue for activities under the 
direct responsibility of the district government. They include the dis- 
trict's own sources of income through local taxation; so-called equal- 
ization grants, which replaced transfers from Jakarta; and borrowing 
at home and abroad. The equalization grants contain a general fund 
allocation, a special fund allocation, and provisions for revenue shar- 
ing in the exploitation of natural resources within the borders of the 
district. This revenue sharing ranges from 1 5 percent of revenues for 
oil exploitation and 30 percent for natural gas, up to 80 percent for 
logging, fisheries, and non-oil, non-gas mining. This provision meant 
that certain districts located in resource-rich jurisdictions such as the 
Special Region of Aceh (called Nanggroe Aceh Darussalam, 1 999- 
2009) and the provinces of Kalimantan Timur and Papua quickly 
started to receive substantially more income than previously. 

The decentralization reform enjoyed considerable popular support 
from the outset. It was generally regarded as having gotten off to a 
strong start, but the authorities were criticized for proceeding too 
hastily. Rules for allocating funding preceded a precise definition of 
tasks under district responsibility, and the distinctions among the 
various levels of government remained blurred by liberal use of the 
term region (daerah) in legislation and official instructions. One 
direct consequence of the reform was the reassignment of 1 .9 million 
civil servants from the central government to local authorities, with- 
out these individuals actually having to move physically. The trans- 
fer affected almost 50 percent of all civil servants in Indonesia, 
including large numbers of teachers and health-care workers. By 
2005 two out of three civil servants in Indonesia were working for a 
local government. 

The overall allocation of budgetary expenditures to the central and 
local governments stabilized at a ratio of 70 percent to 30 percent dur- 
ing the five years immediately following the decentralization reform. 
This division implies that as much as 6 to 7 percent of GDP was actu- 
ally being transferred annually by the central government to be spent 
by a local authority. Intergovernmental transfers form the chief source 
of income for local governments, accounting for an average of 76 per- 
cent of disposable funds at the local level. Moreover, bypassing the 
provincial level of government, in accordance with the 1999 legisla- 
tion, led to the expenditure of 75 percent of decentralized revenue 



184 



Rambutan fruit seller, Jakarta 
Courtesy of Anastasia Riehl 



according to the priorities of district administrative heads or regents 
(bupati) in rural regencies and mayors in the municipalities. The 
direct link between budget authority and locally elected officials can 
have a positive impact in terms of enhancing democracy, but it may 
equally well offer enlarged opportunities for corruption. Subsequent 
revisions to decentralization legislation restored some authority to 
provincial governments. 

Monetary and Exchange-Rate Policy 

Bank Indonesia, the nation's central bank, was founded in 1953 as 
the successor to the Java Bank, which had been nationalized two 
years earlier. Bank Indonesia has since then been supervised by a 
monetary board chaired by the minister of finance, which has made it 
difficult for the central bank to pursue monetary policies indepen- 
dently of the current administration. Although this arrangement 
remained unchanged in 2008, legislation in 1999 had strengthened the 
position of the governor of Bank Indonesia vis-a-vis the government, 
notably by precluding dismissal unless criminal charges were raised. 
The bank's major tasks are regulating the money supply, setting the 



185 



Indonesia: A Country Study 



exchange-rate policy, and supervising the financial sector. A chief 
instrument for monetary policy was established in 1984 when Bank 
Indonesia started issuing its own debt in the form of certificates, Ser- 
tifikat Bank Indonesia (SBIs). Because commercial banks have been 
encouraged to invest short-term funds in SBIs, Bank Indonesia has 
been able to influence the volume of bank reserves by buying and 
selling SBIs. Bank Indonesia also has supported the development of 
other privately issued short-term debt instruments. A sophisticated 
market in short-term securities has offered banks a tool for more flex- 
ible management of their total assets and has encouraged them to hold 
short-term funds in rupiah rather than in international currency depos- 
its, which had become the practice in the 1970s and early 1980s. 
Because the Indonesian government maintained a balanced budget, 
no securities were made available until crisis management required 
financing by means of large-scale issuing of government bonds. 

Very high inflation was a major problem during the final years of 
the Sukarno administration, when budget deficits were increasingly 
financed by Bank Indonesia in compliance with instructions from the 
monetary board but in flagrant violation of the bank's own charter, 
which limited central bank credit to 20 percent of gold and foreign- 
exchange reserves. The Suharto government curbed inflation, reduc- 
ing it from about 900 percent in 1966 to 9 percent by 1970. When oil 
revenues surged in 1974, the central bank found itself, in essence, 
printing rupiah currency in exchange for oil revenues denominated in 
U.S. dollars. Bank credit increased precipitously once the currency 
was deposited in domestic banks. Inflation shot to more than 40 per- 
cent annually, and Bank Indonesia responded by imposing direct con- 
trols on the volume of credit issued by individual banks, a policy that 
made it harder for private banks to compete with the favored state 
banks. By 1978 inflation had come down to less than 10 percent per 
year, but four years of double-digit increases had seriously under- 
mined the competitiveness of Indonesia's exports. 

The liberalization of the financial sector was accompanied by 
measures to contain inflationary pressures, such as imposing high 
rates of interest on domestic bank credit. Bank Indonesia also inter- 
vened directly by controlling the availability of SBIs. On two occa- 
sions, in late 1987 and early 1991, the central bank required state- 
owned corporations to withdraw large sums from their deposits, 
Rp800 billion (about US$486 million) in 1987 and Rp8 trillion 
(about US$4.1 billion) in 1991, to purchase SBIs, which deprived 
banks of a major source of funds to be used for speculative purposes. 
As a result, inflation in Indonesia continued at an average of about 
14 percent per year throughout the 1980s, which was low by the 



186 



The Economy 



standards of many developing countries but above that of many of 
Indonesia's industrialized trading partners. Rapid growth in the early 
and mid-1990s reintroduced inflationary pressures, but cautious 
monetary policies resulted in a relatively moderate rate of inflation 
averaging 9 percent per year during the 1991-96 period. 

The immediate inflationary impact of the Asian financial crisis 
severely eroded purchasing power, bringing whole segments of the 
economy to a virtual standstill and pushing millions of people from 
just above to below the poverty line (see Employment and Income, 
this ch.). Controlling inflation became a top priority during the subse- 
quent economic recovery. In 2002 the IMF assumed that 9 to 1 1 per- 
cent per year would be a manageable rate of inflation. In budgetary 
planning for 2001-3, the government projected a lower rate, 8 to 9 
percent, which was generally sustained despite a spike to 1 5 percent 
in early 2002. By 2004 restrictive monetary policies had reduced the 
rate of inflation to 5 percent annually, and in its planning for 2005 and 
2006 the government chose less-than-ambitious targets in the range 
of 6 to 8 percent. Actual inflation in 2007 amounted to 6.6 percent, 
and, for 2008, the central bank targeted 4 to 6 percent inflation. 

Bank Indonesia also managed the exchange rate between the 
rupiah and foreign currencies, a responsibility that sometimes con- 
flicted with its tasks of regulating the volume of bank credit and the 
size of the base money supply. After floating the rupiah from 1966 to 
1971, Bank Indonesia pegged the exchange rate at Rp415 per US$1. 
To maintain this exchange rate, the central bank had to buy or sell as 
much foreign currency as necessary at the predetermined rate. Three 
major devaluations occurred in the following years. Bank Indonesia 
set new rates of exchange at, respectively, Rp625 per dollar in 1978, 
Rp970 per dollar in 1983, and Rpl,641 per dollar in 1986. The main 
objective was to address the eroding competitiveness of non-oil 
exports resulting from Indonesia's rate of inflation being higher than 
the rate in the home countries of important buyers of Indonesian 
manufactured products. The exchange-rate strategy became an 
important instrument supporting the industrialization policy to 
reduce dependence on oil and natural gas. 

From the late 1980s onward, the rupiah was effectively, if not offi- 
cially, pegged to the U.S. dollar in such a way that it was allowed to 
depreciate in a smooth but highly predictable manner at a rate slightly 
above 5 percent per year. The nominal value of the rupiah fell by 37 
percent against the dollar, from Rp 1,840 per dollar in 1990 to Rp2,900 
per dollar in mid- 1997. Then came the financial crisis, and with it the 
urgent need to control the free fall of the rupiah and mitigate the 
extreme short-run fluctuations in the exchange rate. By agreement 



187 



Indonesia: A Country Study 

with the IMF, Indonesia became committed to a floating exchange 
rate under which the value of the currency would be determined 
exclusively by market forces. This commitment was retained even 
after direct involvement by the IMF in Indonesian economic policy 
came to a conclusion, thus precluding pursuit of an active exchange- 
rate policy by Bank Indonesia. Assumptions underlying the central 
government budget during the period of economic recovery in the first 
years of the twenty-first century stayed within a narrow range, from 
Rp8,600 per dollar in 2004 to Rp9,900 per dollar in 2006. The value 
of the currency averaged Rp8,875 per dollar during the period 2002- 
4, stabilized at Rp9,250 per dollar in August 2007, but increased to 
Rp 12,000 during the emerging world economic crisis in 2008. 

Market interventions with SBIs served to secure a stable increase 
in the base money supply of about 7 percent per year, which was, 
incidentally, also the target that the IMF had recommended in the 
wake of the financial crisis. Continuous monetary expansion was 
accompanied by an increase in credits made available by commer- 
cial banks. In 2000 total outstanding commercial credit reached 
Rp720 trillion (US$86 billion), 140 percent above the level of March 
1997, and by 2004 it amounted to Rp965 trillion (US$110 billion). 
The annual increase during the intervening period had been 8.5 per- 
cent, which may be contrasted with the 26.0 percent increase in 
banking credit in FY 1996 alone. Stability returned to monetary and 
exchange-rate developments as soon as the recovery from the crisis 
gained momentum. 

Indonesia in the Global Economy 

The Changing Nature of Trade and Aid 

Indonesia is highly integrated into the global economy, and 
exports are vital to its economic development. By the 1980s, exports 
accounted for about 25 percent of GDP, and this proportion has 
stayed remarkably stable over time. In 2004 total foreign exports 
amounted to Rp625,295 trillion (US$71.6 billion), corresponding to 
27 percent of GDP, and in 2007 the total value of exports approached 
Rpl, 100,000 trillion (US$114 billion), or about 31 percent of GDP. 
Expressed in current market prices, export revenues rose threefold 
between 1980 and 2004. During the next several years, 2004-7, 
exports increased by an average of 17 percent per year. The tradi- 
tional range of exports, consisting almost exclusively of oil, natural 
gas, and other primary products, has broadened to include manufac- 
tured goods. The most vital distinction in the structure of exports 
refers to the division between oil and natural gas on the one hand and 



188 



The Economy 



all other products on the other. The share of oil and natural gas 
reached nearly 80 percent around 1980 but fell to about 50 percent in 
the late 1980s, 32 percent in the early 1990s, and 22 percent by 
1997. After the 1990s, scarcely more than 20 percent of Indonesia's 
export revenues originated from deliveries of oil and natural gas. 

The export sector's traditional reliance on the country's rich natu- 
ral resources made the economy vulnerable to the vicissitudes of 
changing world prices for these products. The need to shift to manu- 
factured exports became especially urgent when world oil prices fell 
sharply in the mid-1980s. This shift having been successfully accom- 
plished, Indonesia now faces increasingly stiff competition from 
other low-cost producers of manufactured goods, especially China. 
Initially, plywood was the most important manufactured export, its 
production having been facilitated by a total ban on log exports in the 
early 1980s. However, by the late 1990s plywood accounted for only 
10 percent of manufacturing exports, and textiles, in particular gar- 
ments, and electrical appliances were both of greater importance, 
whereas paper products, footwear, and chemical goods each equaled 
plywood among manufactured exports. In 2007 the total value of 
manufactured exports amounted to US$76 billion, with three catego- 
ries of products accounting for 28 percent of this total: textiles at 13 
percent and electrical goods and wood products at 7 and 8 percent 
each. Although manufactured exports have come to dominate Indo- 
nesian deliveries to the world market, the emphasis has remained on 
labor-intensive production. An estimate from just before the 1997-98 
financial crisis suggested that only 15 percent of Indonesia's manu- 
factured exports originated from industries characterized by an inten- 
sive use of technology and know-how. Access to local raw materials 
and cheap labor have remained the main sources of competitiveness 
for Indonesian manufactured exports in world markets. 

Steady growth in non-oil exports has helped Indonesia to finance 
imports, in particular inputs needed for manufacturing production for 
exports. During the 1980s and early 1990s, imports increased more 
rapidly than exports, but this trend reversed radically during the 
financial crisis as the depreciated Indonesian currency effectively 
reduced the volume of purchases from abroad. As a result, the sur- 
plus on the commodity balance of trade improved from about 20 per- 
cent of total export earnings in the first half of the 1990s to 47 
percent in 1999, only to stabilize at a slightly lower level in the first 
years of the twenty-first century. On the eve of the crisis, imports 
consisted of about 71 percent raw materials and intermediate goods, 
22 percent capital goods, and only 7 percent consumer goods. This 
pattern has remained unchanged, reflecting an increasing dependence 



189 



Indonesia: A Country Study 

for export production on foreign imports as well as far-reaching 
import substitution. 

The positive trade balance notwithstanding, Indonesia has often 
suffered from a deficit on the current account because of increasing 
service costs and interest payments on outstanding foreign debt. The 
deficit on the current account worsened from scarcely more than 
US$1 billion in 1989 to almost US$8 billion in 1996. Driven by rap- 
idly declining imports, the huge improvement in the balance of trade 
during the financial crisis turned the deficit on the current account 
into a surplus. The surplus on the current account grew to US$5.9 bil- 
lion in 2000 and stayed at that level until 2003, when outflows began 
to increase as a result of economic recovery. One consequence of the 
crisis for the surplus on the current account was that international 
reserves were not depleted but actually increased between 1996 and 
2000. A key factor in the state of Indonesia's capital account has been 
the inflows and outflows of foreign direct investment. 

Export growth has also contributed to Indonesia's ability to borrow 
from world financial markets and to obtain foreign aid. Public debt 
grew in particular during the 1980s, whereas private debt expanded 
dramatically during the 1990s, providing a major cause of the finan- 
cial crisis that struck Indonesia in 1997-98. Increasing foreign 
indebtedness as a means of combating the crisis and staging an eco- 
nomic recovery implied a heavy burden on the government budget in 
the early twenty-first century. Successive repayments reduced the 
total outstanding foreign debt from almost US$150 billion in 2001 to 
US$113 billion by 2004. The reduction applied fully to private 
indebtedness, whereas the public foreign debt increased from US$69 
billion in 2001 to US$80 billion in 2004. These trends reversed after 
2004, as private debt increased by US$35 billion in the face of a 
decline in public debt to US$69 billion. As a result, Indonesia's total 
foreign indebtedness amounted to US$137 billion in December 2007. 

Multilateral aid to Indonesia has traditionally been an area of 
international interest, particularly on the part of the Netherlands, 
Indonesia's former colonial ruler. Starting in 1967, the bulk of Indo- 
nesia's multilateral aid was coordinated by a consortium of foreign 
governments and international financial organizations, the Inter- 
Governmental Group on Indonesia (IGGI — see Glossary). The IGGI 
met annually under Dutch leadership, although aid from the Nether- 
lands accounted for an ever-smaller proportion of the total. The 
Netherlands suspended aid to Indonesia following the shootings by 
the Indonesian army of between 50 and 270 demonstrators in Dili, 
Timor Timur Province, in November 1991; in turn, in March 1992 
the Indonesian government said it would henceforth refuse all Dutch 



190 



The Economy 



aid. The IGGI was replaced by the Consultative Group on Indonesia 
(CGI), formed on the initiative of the World Bank and chaired by 
Japan, Indonesia's single largest aid donor. The CGI was instrumen- 
tal in facilitating international debt restructuring during the Asian 
financial crisis. The volume of annual commitments of assistance 
declined gradually from a peak of US$8 billion during the crisis to a 
stable level of US$3 billion during the period 2002-4. An additional 
US$5. 1 billion for tsunami relief reached Indonesia in 2005 (see Vol- 
canos and Earthquakes, ch. 2). 

Principal Trade Relationships 

Indonesia's trading partners have traditionally included numerous 
countries throughout the world. At the end of the twentieth century, 
most imports came from just three places: the European Union (EU; 
26 percent), Japan (18 percent), and the United States (18 percent). 
Member countries of the Association of Southeast Asian Nations 
(ASEAN — see Glossary) supplied only 10 percent. In the twenty- 
first century, China has also emerged as a major supplier of imports 
to Indonesia. The growth in Indonesia's production of manufactured 
products has contributed to a diversification of export markets, espe- 
cially in Asia. In 2006 more than 50 percent of all exports went to 
Asian trading partners, in particular to Japan, the ASEAN states, 
China and India, whereas the United States and the EU between them 
purchased 27 percent of all Indonesian exports. Oil and liquefied nat- 
ural gas (LNG), however, continued to be supplied to a rather limited 
number of customers. In the late 1990s, Japan bought one-third of 
Indonesia's oil and two-thirds of its LNG; South Korea and Taiwan 
also figured prominently among customers for Indonesian LNG. Five 
leading trading partners, China, Japan, Malaysia, Singapore, and the 
United States, accounted for more than 50 percent of all non-oil and 
natural gas exports in 2004. The United States and Japan became key 
markets as the development of manufacturing export production in 
Indonesia gained momentum, while Singapore retained its traditional 
role as an intermediary in trade with third countries. Rapid increases 
in non-oil, non-gas exports to China and ASEAN neighbors such as 
Malaysia signified new trends in Indonesian trade. 

Diplomatic relations with China were reestablished in 1991, and 
exports to that country doubled over the next six years (see Relations 
with East Asia, ch. 4). Bilateral trade declined during the 1997-98 cri- 
sis but recovered by 2000. Indonesian imports from China increased 
by more than 60 percent in the year 2000 alone, reflecting a tendency 
among Indonesian importers to replace expensive imports from Japan 
with cheaper goods from China. Bilateral trade experienced a rapid 



191 



Indonesia: A Country Study 

expansion starting in 2002, and already by 2005 the value of Indone- 
sian exports to China was 150 percent above the 1997 level. The 
expansion of Indonesian imports from China was even more spectac- 
ular. In 2005 their level was almost four times that of 1997. The shift 
from a trading relationship based on Indonesian exports to one based 
on Indonesian imports in bilateral trade with China testified to the 
dynamic nature of international commerce in the region. 

ASEAN was founded in 1967 to promote regional stability, eco- 
nomic development, and cultural exchange in Southeast Asia. Its orig- 
inal members were Indonesia, Malaysia, the Philippines, Singapore, 
and Thailand; starting in the mid-1980s, Brunei, Burma (Myanmar), 
Cambodia, Laos, and Vietnam also joined. Not until the late 1970s did 
the ASEAN states give serious attention to matters of economic inte- 
gration, such as the establishment of joint industrial projects. In Janu- 
ary 1993, preparations began for an ASEAN Free Trade Area 
(AFTA). Originally scheduled for 2008, implementation was moved 
forward to 2002, and by 2006 most import tariffs in intra- ASEAN 
trade were 2 percent or less. Intra- ASEAN exports doubled between 

2002 and 2006, rising from US$ 9.9 billion to US$ 18.5 billion. Four 
priority areas were designated for further rapid expansion: electronics, 
agro-processing, rubber-based products, and transport vehicles, all of 
which were important branches of manufacturing for Indonesia. In 

2003 Bank Indonesia predicted that full implementation of AFTA 
would increase competition and reduce prices in the domestic market 
while offering new opportunities for Indonesian exporters. Confi- 
dence in the growth potential of both large and small enterprises was 
also voiced in 2006 by then ASEAN secretary general Ong Keng 
Yong. The association's stated ultimate goal is to establish an ASEAN 
Economic Community by 2015. 

Employment and Income 

The world's fourth most populous nation, Indonesia had an esti- 
mated 240.3 million inhabitants in 2009, 60 percent of whom lived 
in Java, 21 percent in Sumatra, and another 12 percent in Kalimantan 
and Sulawesi taken together. The increase in population over the pre- 
ceding 18 years alone amounted to almost 50 million people. At 
least 60 percent of all persons 1 5 years of age and older were gain- 
fully employed. The labor force grew from 75 million in 1988 to 86 
million in 1993 and 106 million in 2006, or 1 17 million when includ- 
ing those who were economically active but not at work. The rapid 
growth reflected both the increase in the working-age population, 
estimated at 2.7 percent per year, and an increasing rate of economic 
participation by women. It has been a major challenge for the Indo- 



192 



The Economy 



nesian economy to offer employment to such large numbers of peo- 
ple entering the labor market each year. 

Structural change in the Indonesian economy has had fundamental 
repercussions for employment patterns and especially the composi- 
tion of national income. In 1985 agriculture contributed only 25 per- 
cent of GDP but provided employment for 53 percent of the labor 
force. In addition to the agricultural employment in the 1980s, 1 1 per- 
cent of the labor force worked in manufacturing, 1 8 percent in trad- 
ing, 14 percent in finance and other services, and 4 percent in 
construction. A milestone was reached around 1990 when agricul- 
ture's share of employment fell below 50 percent, and Indonesia was 
no longer a predominantly agrarian economy. Further expansion of 
employment outside agriculture, particularly in services, reduced the 
agricultural proportion of the labor force to 43 percent by 1997. Mod- 
ernization of employment patterns came to a halt in the wake of the 
1997-98 financial crisis; for instance, the share of the workforce in 
agriculture was 44 percent in 2005, up a point from 1997. There has 
been a tendency for the labor force in the primary sector, comprising 
agriculture, forestry, and fisheries, to increase somewhat in relative 
terms at the expense of manufacturing and services. The interruption 
of the trend toward restructuring of the economy away from the tradi- 
tional predominance of the primary sector in employment patterns is 
one of the most serious consequences of the financial crisis. 

In a developing country such as Indonesia, official open unemploy- 
ment is a statistic with much less meaning than in an industrial economy. 
Registration as being unemployed carries no benefits, and those laid off 
from jobs in the formal sector are likely to work fewer hours or resort to 
some kind of pursuit in the informal sector. Open unemployment was 
registered at only 3 percent of the labor force around 1990, but this figure 
ignored much underemployment. Official unemployment increased only 
marginally even during the worst year of the financial crisis, from 4.7 
percent in 1997 to 5.5 percent in 1998. Supplementary data offer a differ- 
ent impression. During the first crisis year alone, the number of workers 
declined 15 percent in medium-sized and large manufacturing enter- 
prises and 20 percent in small manufacturing firms and cottage indus- 
tries. More than 300,000 workers in the textiles and garment industry had 
already lost their jobs by March 1998. The International Labour Organi- 
zation (ILO) estimated conservatively that 7 percent of the Indonesian 
labor force would be out of work by the end of 1998. The informal sector 
in rural areas had to absorb more than 3 million workers who had been 
laid off in the cities. 

In 2001 the Central Statistical Office (BPS) tried to obtain a better 
representation of actual unemployment by applying a wider definition 



193 



Indonesia: A Country Study 

that included discouraged workers. As a result, the official unemploy- 
ment figures, 5.8 percent in 2000 and 6.5 percent in 2004, were adjusted 
upward to 8.1 percent and 10.1 percent, respectively. The rate of unem- 
ployment stayed at a stubbornly high level after the initial recovery 
from the financial crisis, and in late 2004 the newly installed adminis- 
tration of Susilo Bambang Yudhoyono pledged to reduce official open 
unemployment by half by 2009. However, in 2007 officially registered 
unemployment was still as high as 9.1 percent. 

The introduction of minimum- wage legislation in 1992 appeared 
contradictory to the prevailing mode of deregulation at the time. The 
Indonesian government took this measure partly in response to criti- 
cism from the ILO and the American Federation of Labor about poor 
working conditions in Indonesian manufacturing. Implementation of 
this policy led to considerable regional differences in nominal daily 
wage rates, which ranged in 1995 from Rp3,100 (about US$1.38) in 
Sulawesi Selatan Province to Rp4,600 (about US$2.04) in Jawa Barat 
Province. Real wage rates, after correction for inflation, increased by 
more than 200 percent in Jawa Barat and Jawa Tengah provinces but 
by less than 100 percent in the capital, Jakarta, and in Sumatera Utara 
Province. Earnings outside the industrial sector were typically lower, 
with the exception of services such as finance and banking. 

The financial crisis, with its concomitant rapid inflation, brought a 
sharp dip in real minimum wages in 1998 and 1999; only in 2001 was 
the pre-crisis level of the real minimum-wage rate restored. Yet, this 
was the outcome of political and administrative change rather than a 
sign of economic recovery. The decentralization reform that became 
effective in January 2001 vested the power to set minimum- wage rates 
with provincial authorities, which caused an immediate increase in the 
minimum- wage rate in many provinces. Jakarta led the way with a 
wage hike of 38 percent, followed by adjacent districts in Jawa Barat 
Province. Other centers of labor-intensive manufacturing industry lim- 
ited increases to 20 percent. After 2001 real minimum- wage rates also 
continued to rise, but the pace of increase remained smooth and mod- 
erate. In 2004 the highest nominal wages were paid in the greater 
Jakarta metropolitan area — then known as Jabotabek (for the four 
adjacent population centers of Jakarta, Bogor, Tangerang, and Bekasi), 
now known as Jabodetabek to include Depok — where rates were on 
average 72 percent higher than in the city of Surabaya in Jawa Timur 
Province, or 144 percent higher than in the Special Region of Yogya- 
karta in central Java. Workers in non-oil mining were likely to earn 
three times as much as employees in highly labor-intensive lines of 
manufacturing production such as textiles. 



194 




Chili vendors, Karambosan market, Sulawesi Utara Province 

Courtesy Anastasia Riehl 



Effective enforcement of minimum-wage rates was difficult from 
the start. Attempts by employers to circumvent the legislation had 
already become a frequent cause of labor unrest in the mid-1990s. 
The problem of enforcement survived the collapse of the Suharto 
regime. Statistics for 2000 show that only 43 percent of surveyed 
employees actually received more than the minimum wage. The score 
was especially bad for female workers, 75 percent of whom received 
less than the minimum wage. Rural workers were also disadvantaged, 



195 



Indonesia: A Country Study 

and wages in manufacturing were found to be seriously lagging 
behind those in the services sector. 

Labor unrest increased significantly in the 1990s, although there was 
only one officially sanctioned trade organization, the All-Indonesian 
Workers' Union (SPSI), which was converted in 1995 into the All- 
Indonesian Workers' Union Federation (FSPSI). Activism was fur- 
thered by the rise of two rival independent unions. One, the Indonesian 
Prosperous Workers' Union (SB SI), was founded in 1992 and run by 
Muchtar Pakpahan, who was exceptionally outspoken in his criticism 
of the government. Confrontations between the Suharto administration 
and the SB SI culminated in a rising number of strikes during the mid- 
1990s, and the imprisonment of Pakpahan. Frequent violent strikes 
accompanied the financial crisis and other events leading up to the 
change of government during 1997-98. Labor unrest subsided some- 
what in 1999 but flared up again in 2000. That year there were 173 
major strikes — compared with 125 in 1999 — involving more than 
60,000 workers. Demands for higher wages were the main reason for 
trade-union action, but other grievances, such as dismissals, meager 
food provisions, the cost of transportation, and failure to pay out 
accrued social-security benefits, were other causes. Most strikes were 
in the labor-intensive branches of manufacturing. Trade unionism grew 
in the more liberal political climate prevailing immediately after the fall 
of the Suharto regime. In 2001 some 36 trade unions were operating on 
a national level, but many more restricted themselves to individual 
regions or even districts. Several unions, including the SBSI and 
FSPSI, maintained close links with political parties, which had also 
mushroomed in the wake of reformism after 1998. Some trade unions 
expressed a strong Muslim identity. These developments signified a 
belated ideological awakening within organized labor in Indonesia. 

Observers saw an impressive increase in per-capita income in 
Indonesia up to 1997. The nominal average income increased 120 
percent between 1991 and 1996. But the financial crisis had a severe 
impact on incomes, reducing the real per-capita level 13 percent 
between 1997 and 1999 alone, and it was well into the first years of 
the twenty-first century before Indonesians' per-capita GDP returned 
to the 1997 level. However, doubts have frequently been voiced about 
the unequal distribution of income, especially in light of the conspic- 
uous consumption by wealthy Chinese Indonesians and members of 
the Suharto family. Studies have shown the Gini coefficient, which 
measures the degree of inequality in income distribution, to have 
remained stubbornly constant over time. The coefficient fell slightly 
during the first two decades of the Suharto era, from 0.35 in the mid- 
1960s to 0.32 in the late 1980s, but rose to 0.34 in the mid-1990s and 



196 



The Economy 



0.37 during the financial crisis. Indonesia's long-run stability on the 
Gini index (see Glossary) may be interpreted both as an achievement 
by government policies, in the sense that inequality did not get worse, 
and as a failure, in the sense that rapid growth should have resulted in 
relatively more gains accruing to low-income groups rather than sus- 
taining existing discrepancies in income levels. 

Reduction of poverty was invariably listed as one of the major 
achievements of the Suharto government. The BPS defined an official 
poverty line on the basis of the expenditure needed to maintain a daily 
intake of 2,100 calories and to meet other basic needs. The proportion 
of Indonesians living below that line declined from 40 percent in 1976 
to 17 percent in 1987 and to 1 1 percent by 1996. However, it must be 
noted that the official criteria were set at far lower levels than in neigh- 
boring countries in Southeast Asia, and that considerable regional dif- 
ferences were concealed by the nationwide averages. The incidence of 
poverty was higher in rural areas than in cities, and the 1 1 percent reg- 
istered as poor in 1996 corresponded to more than 22 million people. 
The full onslaught of the economic crisis in 1998 occasioned a number 
of projections about the resulting increase in poverty. In August and 
September 1998, a team from the ILO and the United Nations Devel- 
opment Programme (UNDP) predicted that a staggering 48 percent of 
the Indonesian population, 94 million people, would be counted as 
poor by the end of the year, and that this number was likely to continue 
to increase in 1999. A few months later, in December 1998, revised 
estimates by BPS produced a figure of about 20 percent, still high in 
that it corresponded to 40 million people, but nonetheless closer to 
reality than the alarming ILO-UNDP forecast. 

The recovery of the Indonesian economy in the early years of the 
twenty-first century was slow and at best partial. As a result, the 
incidence of poverty declined slowly, from 18.4 percent in 2001 to 
16.7 percent in 2004. These figures again conceal much differentia- 
tion by region. Rural areas were especially severely struck by pov- 
erty. There the incidence by official measure averaged 20 percent in 
2004, against 12 percent for cities. In 2006 the government and 
observers were alarmed by an unexpected increase in the incidence 
of poverty in the face of resumed economic growth. Pockets of pov- 
erty existed in a number of regions where the economic recovery 
failed to generate jobs. The poverty rate climbed to 17.8 percent but 
again reduced, touching 16.6 per cent by 2007. 

Agriculture 

Indonesia has followed a well-recognized trend among developing 
nations, in which agriculture's share of GDP has declined over time, 



197 



Indonesia: A Country Study 

even though the sector still provides employment for a large propor- 
tion of the labor force. The agricultural sector in Indonesia has 
remained vital for several reasons. A significant segment of the popu- 
lation lives and works in rural areas, and rice, the chief food crop, is the 
staple nutrient for most households, urban and rural alike. Adequate 
supplies of affordable rice are deemed essential to preventing political 
instability. 

The share of agriculture in GDP oscillated around 25 percent 
throughout the 1970s and early 1980s but then fell sharply, reaching 
16 percent by 1995. This trend was temporarily reversed with the 
financial crisis, with agriculture's contribution reaching almost 20 
percent of GDP in 1999. Economic recovery reduced the share of 
agriculture again; the average remained stable around 16 percent 
during the first years of the twenty-first century and by U.S. govern- 
ment estimates was about 14.4 percent in 2008 — as compared with 
the Central Statistical Office figure for 2007, of 13.8 percent. Mean- 
while, the share of agriculture in the total labor force dropped, too, 
from more than 50 percent to a little above 40 percent. Within agri- 
culture, food crops have always accounted for the predominant share 
of output, leaving considerably smaller proportions to tree-crop cul- 
tivation, fisheries, and forestry. 

Food Crops 

A total land area of about 42 million hectares was being cultivated 
for agricultural purposes in Indonesia around the turn of the twenty- 
first century. Slightly more than 50 percent was dedicated to food- 
crop cultivation, both intensive sawah (irrigated or wetland) cultiva- 
tion in Java (8.5 million hectares) and ladang (not irrigated) cultiva- 
tion on other islands (16.0 million hectares; see fig. 8). Estates (large 
state-owned or private units of production with a high degree of spe- 
cialization of tasks) accounted for 25 percent of the land in use. 
Since around 1960, expansion of output in food-crop cultivation has 
been attained through intensified land use and application of high- 
yield seed varieties. By 2000 total rice output exceeded 50 million 
tons per year, largely realized in sawah cultivation. Ladang cultiva- 
tion was responsible for most of the non-rice food-crop output, in 
particular the production of cassava and corn, which together 
accounted for an annual yield of more than 25 million tons by 2000. 

In the 1980s, rice cultivation covered a total of around 10 million 
hectares, primarily on sawah land. About 60 percent was irrigated, 
which was crucial to the productivity of land when planted with 
high-yield seed varieties. Output grew at a spectacular rate of 7 per- 
cent annually from 1977 to 1982, and by 1985, Indonesia, once the 



198 



The Economy 



world's single largest importer of rice, was self-sufficient in its most 
important foodstuff. Annual production grew from about 25 million 
tons in the late 1970s to some 50 million tons in the mid-1990s, and 
it then continued at about that level thereafter. The government was 
intensely involved, both in stabilizing prices for urban consumers 
and expanding domestic output to achieve national self-sufficiency 
in rice production. Various government policies included the dissem- 
ination of high-yield seed varieties through the government- spon- 
sored Mass Guidance System (Bimas) in agriculture, which also 
subsidized the use of fertilizer and pesticides and provided rural 
credit. Moreover, government intervention included control of the 
domestic rice price through the National Logistical Supply Organi- 
zation (Bulog). Government investment in irrigation also made a sig- 
nificant contribution. Between 1970 and 1990, about 2.5 million 
hectares of existing irrigated land were rehabilitated, and irrigation 
was extended to another 1.2 million hectares. 

Expansion of food-crop cultivation slowed in the late 1980s and 
early 1990s as a result of ecological constraints on the intensification 
of cropping ratios and lower government investment in irrigation. 

Also, markets for agricultural commodities were depressed. Poor 
harvests in the mid-1990s necessitated a temporary return to rice 
imports, and the situation during the crisis was aggravated by 
repeated droughts during 1997-98 caused by El Nino. By the early 
years of the twenty-first century, it was apparent that the Green Rev- 
olution, started in the late 1960s, had run its course in Indonesia, but 
also that it had had a lasting impact on productivity in food-crop 
agriculture. 

Although rice is by far the most important food crop, cassava and 
corn have remained major sources of calories for large groups of Indo- 
nesians. Corn cultivation is concentrated in Java and Madura, usually 
on rain-fed land (tegalan), and much of the output is generally con- 
sumed as a staple food. Both corn and cassava have increased in impor- 
tance as major supplements to rice. Between 2000 and 2005, production 
of these two crops increased by 15 and 20 percent, respectively. 

Export Crops 

Indonesia has a strong tradition of export crops cultivated by 
estates and smallholders. Java was once the world's third-largest 
producer of sugarcane, and rubber from Sumatra and Kalimantan 
provided important non-oil export revenues during the 1950s and 
1960s. Sugar no longer is an export crop; in fact, Indonesia now 
imports sugar. Rubber lost its strong position in the world market to 
synthetic rubber, and palm oil overtook agricultural exports. By the 



199 



Indonesia: A Country Study 




200 



The Economy 



beginning of the twenty-first century, rubber and palm oil accounted 
for more than 5 million hectares of arable land, with production by 
smallholders as well as by government-owned estates appropriated 
in the nationalization of Dutch properties in the late 1950s. Rubber is 
cultivated on 3 million hectares, of which about 80 percent is land 
owned by smallholders with holdings of two hectares or less. Small- 
holder cultivation is concentrated in Sumatra. 

Palm-oil estates, primarily in Kalimantan and Sumatra, expanded 
rapidly, covering 2.2 million hectares by the mid-1990s. The estates 
represented major investments by leading domestic conglomerates 
and also increasing investment by estate companies based in Malay- 
sia. In 2005 Indonesia was the world's second-largest producer of 
palm oil, behind Malaysia, accounting for more than one-third of 
world output. Palm-oil production in Indonesia climbed from 6.5 
million tons in 2000 to 10.3 million tons in 2004, an impressive 58 
percent increase. Estates provided the largest part of production, but 
the contribution of smallholders increased at a faster rate, exceeding 
one-third by 2004. In 2006 total output amounted to 16 million tons. 

Government efforts to transfer new technologies and increase pro- 
ductivity in export-crop cultivation were less successful than they 
were with food crops. The Nucleus People's Estate (PIR) program, 
which provided small plots of high-yield tree crops to participating 
farmers in predetermined locations, was the main government under- 
taking. One anticipated advantage was the sharing of benefits from 
centralized technological and managerial assistance. However, only a 
few cultivators participated, and little success was achieved, especially 
in rubber cultivation by smallholders. The centralization of facilities, 
which in turn remained seriously understaffed, allegedly stifled indi- 
vidual initiative. 

Other export crops, notably cocoa, coconuts, coffee, and tea, cover 
far smaller planted areas and contribute only marginally to the aggre- 
gate earnings of the overall Indonesian economy. Coconuts are culti- 
vated almost exclusively by smallholders, with production centered in 
Sulawesi. High prices on the world market secured rising incomes for 
some local producers even in the midst of the 1997-98 financial cri- 
sis. The main source of Indonesian coffee beans has traditionally been 
the southern Sumatran province of Lampung, where smallholders 
strongly dominate production. The predominance of smallholders has 
increased since the late 1990s; in the early twenty-first century, they 
accounted for at least 95 percent of output. A temporary decline in 
smallholder production in 2001 was followed by an impressive recov- 
ery during 2002. Annual coffee production by smallholders has since 
remained rather stable, averaging about 660,000 tons. Nevertheless, 



201 



Indonesia: A Country Study 

Indonesian output has not increased as fast as that of chief rivals in 
the world market. By 2005 Indonesia not only ranked behind Brazil, 
Colombia, and Mexico but also had been overtaken by Vietnam. 

Livestock 

Smallholders own nearly all the livestock in Indonesia; these ani- 
mals are sources of draft power, manure, meat for home consumption, 
and, if sold, revenue. The livestock population in Indonesia in the first 
years of the twenty-first century included 35 million ducks, 21 million 
goats and sheep, 11 million cows, 7 million pigs, 2.5 million buffalo, 
and 500,000 horses. Numbering in the hundreds of millions, chickens 
were the fastest-growing type of commercial livestock, notwithstand- 
ing the spread of avian influenza in Indonesia since 2004. Govern- 
ment-sponsored programs to increase productivity through extension 
services to livestock farmers and the expansion of ranching began 
operation in the Outer Islands (see Glossary) in the early 1990s. 

Fishing and Forestry 

Fishing 

Fish has traditionally been a main source of animal protein in the 
average Indonesian diet, being generally far more available than meat. 
The fishing industry engages more than 2 million households working 
in Indonesia's large archipelagic sea area, about 50 percent of them in 
Java and 25 percent in Sumatra (see Geographic Regions, ch. 2). The 
industry is divided into two widely different branches, marine and 
inland, of which the latter includes harvesting from open water as well 
as ponds and aquatic cages. Productivity is far greater in marine fisher- 
ies, which employ only 25 percent of the producer households but oper- 
ate 75 percent of all fishing boats and account for almost 80 percent of 
total output. Total annual production of fish in Indonesian waters oscil- 
lated between 2 million and 3 million tons during the 1980s, reached 
4.5 million tons in 1996, and continued to increase, albeit slowly, dur- 
ing the years of crisis. The annual total surpassed 5.6 million tons by 
2003. Foreign-owned fishing enterprises, which must be licensed, oper- 
ate on a much smaller scale than the domestic industry. Fish exports 
consist primarily of shrimp and tuna for the Japanese market. 

Enormous changes have taken place in Indonesian fisheries since 
around 1980, when the physical possibility of extending catch areas 
began to be exhausted. The government designated offshore waters 
as exclusive economic zones closed to fishing, and it banned trawl- 
ing in the waters surrounding Java and Bali. The frontier of expan- 
sion was thus literally closing, and output could increase only by 



202 





Planting rice, Banyumas, Jawa Tengah Province 

Courtesy Eric Stein 

A fishing boat under construction, Madura, Jawa Tengah Province 
Courtesy Florence Lamoureux, used with permission 
©Center for Southeast Asian Studies, University of Hawai 'i 



203 



Indonesia: A Country Study 

intensification and overfishing. By the mid-1990s, the trawling ban 
had ceased to be effective, having resulted in numerous incidents in 
which small-scale Indonesian fishers took matters into their own 
hands, attacking intruding Thai and Taiwanese trawlers. Mangrove 
forests all along the eastern coastline of Sumatra have been trans- 
formed into shrimp ponds; large fish-catching stakes tended by teen- 
age boys have been put into operation in Sumatran estuaries; and 
coral reefs off Papua have been severely damaged by the use of cya- 
nide poisoning and fish blasting as harvesting practices. With the 
biodiversity of Indonesian waters seriously threatened, the govern- 
ment doubled its efforts between 1999 and 2006 to reduce foreign 
fishing in order to at least reserve the scarce resources for the large 
domestic industry. 

Forestry 

Forests cover 110 million hectares, or 57 percent, of Indonesia's 
land area; two-thirds of the forested area is tropical rain forest in 
Kalimantan and Papua. Estimates of the rate of depletion reached 1 
million hectares per year during the mid-1980s, while targets for 
reforestation and afforestation were set at 95,000 and 250,000 hect- 
ares, respectively. The government revised these targets significantly 
downward in the late 1980s but increased them again during the 
1990s, reaching a combined level of nearly 200,000 hectares by the 
late 1990s. Official logging output fell by two-thirds during the 
period 1998-2002, but targets for rehabilitation of forests were 
reduced even further, being restored to 250,000 hectares in 2003, 
339,000 hectares in 2004, and as little as 27,000 hectares by 2005. In 
1999 estimates put the extent of endangered forest land at 23.2 mil- 
lion hectares, of which only 1.2 million hectares, or about 5 percent, 
had been rehabilitated four years later. Forest Watch Indonesia, the 
Indonesian Forum for Environment, and the Department of Forestry 
estimated that the rate of deforestation rose to a staggering 4 million 
hectares per year in 2003. Replenishment of forest resources in Indo- 
nesia clearly was lagging far behind both ecological and commercial 
needs and official targets. 

Uncontrolled expansion of logging operations, both legal and ille- 
gal, has magnified the ecological issues in Indonesian forestry. The 
1970s witnessed a boom in logging concessions, both large-scale 
and small-scale, whereas a ban on log exports put in place by the 
government in 1983 fostered the emergence of timber conglomer- 
ates. The expansion was fueled by liberal regulation of concessions, 
extremely low taxation, lax enforcement of reforestation obligations, 
and widespread corruption. During the 1980s alone, large business 
groups acquired concessions covering millions of hectares, and the 



204 



The Economy 



production capacity of Indonesia's 100 or so plywood plants rose 
eightfold. Together with Malaysia, Indonesia then supplied more 
than 90 percent of the world's tropical plywood exports. Govern- 
ment promotion of the domestic timber-processing industry was 
seen as the most immediate threat to Indonesia's forests, but in the 
long run, settlement by migrants under government-sponsored trans- 
migration programs may have had an even greater impact. 

In the 1990s, the gap between total demand from the plywood 
industry and officially authorized logging output widened, giving a 
new impetus to illegal logging. In 2001 the total timber harvest in 
Indonesia amounted to 60 million cubic meters, 50 million of which 
may have been obtained illegally. Possibly 10 million cubic meters 
was smuggled abroad, mostly to Malaysia. The Indonesian press and 
politicians generally have put the blame for illegal logging and tim- 
ber smuggling on small-scale loggers and Malaysian and ethnic Chi- 
nese traders. In the early twenty-first century, they were also held 
responsible for the haze of smoke that regularly emanated from for- 
ests burning in Sumatra and Kalimantan, causing both health hazards 
and irritation in neighboring countries. Yet such viewpoints easily 
overlook the far-reaching involvement of Indonesian conglomerates 
in large-scale logging and plywood production and also divert atten- 
tion from a long history of forest mismanagement dating back to the 
boom of the 1970s. This history entered a new phase with the decen- 
tralization of responsibility for forest policies in 2001. The delega- 
tion of authority had the potential to enhance local involvement in 
the terms of implementation, but it could equally well prove condu- 
cive to further corruption at the local level. 

Industry 

Indonesia was a late starter in industrialization, lagging behind 
regional neighbors such as Malaysia and Thailand by at least a decade. 
This delay may be attributed to the generous revenues from exploiting 
natural resources that effectively postponed a sense of urgency regard- 
ing rapid industrialization. The first phase of import substitution relied 
on labor-intensive production with a low level of technological 
sophistication and took place in the 1970s, but its impact on the econ- 
omy was limited. By the early 1980s, manufacturing not related to oil 
and gas still accounted for only 1 1 percent of GDP, and production 
catered almost exclusively to the domestic market. In the 1980s, a sec- 
ond phase of import substitution shifted the focus to selected key 
upstream industries with a relatively high level of technological 
sophistication, including heavy industries such as petroleum refining, 
steel, and cement, in which state-owned enterprises often dominated. 



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Indonesia: A Country Study 

The next shift in industrial policy favored private investment and an 
export orientation. Between 1987 and 1997, a rapid industrialization 
took place that caused a surge in manufacturing exports while raising 
the share of non-oil and gas manufacturing to 25 percent of GDP, a 
level sustained into the twenty- first century. 

A detailed study by Australian economist Hal Hill of the industrial 
structure in Indonesia in the 1980s underscored the continuing pre- 
dominance of oil and natural gas processing and showed the second 
major industrial activity to be the production of kretek cigarettes, a 
popular Indonesian product'made from tobacco blended with cloves. 
Most of the 13,000 firms Hill surveyed were privately owned, and 
generally much smaller than the joint ventures with either the govern- 
ment or foreign investors, which employed, on average, six times as 
many people. Government enterprises controlled all processing of oil 
and natural gas and were important in other heavy industries, such as 
basic metals, cement, paper products, fertilizer, and transportation 
equipment. The growing industries manufacturing for export offered 
far more employment opportunities than the capital-intensive heavy 
industries dominated by government and joint ventures with foreign 
capital. 

As the twenty- first century began, the three leading industries out- 
side the oil and gas sector contributed 1 8 percent of GDP. They were, 
in descending order of size, food (including beverages and tobacco), 
transportation equipment (including electrical appliances), and chem- 
ical products (including fertilizer and rubber goods). By 2005 there 
were 20,700 individual large and medium-size manufacturing enter- 
prises employing a total work force of 4.3 million people. 

Industrial development has been unevenly distributed across the 
archipelago (see fig. 9). Significant oil and LNG production occurs 
mainly in the Special Region of Aceh and in the provinces of Suma- 
tera Selatan, Riau, Jawa Tengah, Kalimantan Timur, and Papua Barat. 
In western Java, manufacturing outside the oil and gas sector centers 
on Jabodetabek, and in and around Surabaya, Indonesia's second-larg- 
est city, in Jawa Timur Province. Regional forms of specialization in 
industrial production include batik printing and furniture making in 
the Special Region of Yogyakarta and in Jepara, as well as kretek ciga- 
rette manufacturing in Kudus, the latter two in Jawa Tengah Province. 

Foreign Inputs 

Foreign direct investment (FDI) has particularly targeted the 
industrial sector since the beginning of Suharto's New Order in 
1966. There have been several marked shifts in the climate for FDI 
over time. The launch of new FDI legislation by the Suharto govern- 



206 



The Economy 



ment in 1967 initiated a liberal period of seven years, after which 
came 20 years of restrictive policies prompted by nationalist riots 
during the visit of Japan's prime minister to Jakarta in January 1974. 
Regulations in effect from 1974 to 1994 precluded majority equity 
ownership in a firm by a foreign investor in the long run and urged 
gradual divestment of such holdings. Although these regulations 
produced a slowdown in investment, the new opportunities for 
export-oriented manufacturing that opened up in the late 1980s 
proved highly attractive to foreign investors. A deregulation package 
announced in June 1994 radically liberalized foreign investment. 
Foreign majority control of equity again became legal, and divest- 
ment rules relaxed. An immediate surge in FDI followed that even 
persisted far into the 1997-98 financial crisis. 

Total realized FDI from 1991 to 2005 exceeded US$75 billion, 
US$31 billion of which dated to the five years from 1996 to 2000, 
which included the worst of the financial crisis years. This total can 
be compared to the aggregate for realized domestic investment dur- 
ing the 1991-2005 period, which was closer to US$215 billion. The 
United States remained the chief investor in the oil and natural gas 
sector but played only a marginal role in other branches of industry 
(see Other Minerals, this ch.). Japan traditionally was the first-rank- 
ing foreign investor outside the oil and natural gas industry, but 
investment from the newly industrializing economies of Hong Kong, 
Singapore, South Korea, and Taiwan became equally important dur- 
ing the rapid enlargement of incoming FDI in the 1990s. Investors 
from the EU made only a belated entry, or in some cases reentry, into 
the Indonesian capital market on the eve of the 1997-98 crisis. It 
took some time before FDI inflows were restored after the 1997-98 
crisis. Total approved FDI rose from US$14 billion in 2003 to 
US$40 billion by 2007. 

Foreign investment has often been crucial to the development of 
capital-intensive heavy industries. A prime example is the Asahan 
Hydroelectric and Aluminum Project, a government joint venture with 
a consortium of Japanese companies. Investment in an aluminum 
smelter and two hydroelectric power stations, located in Sumatera 
Utara Province, was worth a total of US$2.2 billion, a welcome change 
from the relative stagnation that characterized Japanese investment in 
Indonesia from the mid-1970s to the mid-1990s. In another type of 
project, the development of special economic zones on the Riau Archi- 
pelago islands of Batam, Bintan, and Karimun was entrusted to a con- 
sortium consisting of a state-owned Singapore company and two 
private Indonesian firms, in an agreement signed June 28, 2006. About 
80 percent of Indonesia's oil-equipment industry is located on Batam 



207 



Indonesia: A Country Study 




208 



The Economy 



Island, and the project will likely lead to further development of these 
facilities as well as others involving electronics, chemicals, precision 
equipment, garments, and other manufactures. 

In many industries, foreign firms have supplied technical assis- 
tance and arranged for domestic production under licensing agree- 
ments without direct equity participation in the domestic firm. For 
example, domestic Indonesian plants have produced automobiles for 
about 20 international car makers, foremost among them Toyota, 
some of whose vehicles are built in Indonesia by Astra International, 
the country's largest auto manufacturer. Other Japanese companies, 
as well as South Korean, European, and American firms, assemble 
their vehicles in Indonesia. The Indonesian automotive industry has 
grown amid heavily protected markets. 

Foreign inputs of a different nature have been applied in high-tech- 
nology enterprises, particularly ones headed by B. J. Habibie, first as 
minister of research and technology and later as president. IPTN, 
established in 1976, assembled helicopters and small fixed- wing air- 
craft under licenses from French, German, and Spanish firms aided 
by imported personnel and know-how. Many people considered 
IPTN a premature leap into advanced technology. Extra-budgetary 
support and credit privileges stopped at the request of the IMF in Jan- 
uary 1998, and operations at IPTN all but ceased subsequently. 

Small-Scale Industry 

The modern sector of large and medium-sized firms is the main 
focus of government policy, but small-scale factories employing 
fewer than 20 workers and cottage industries with up to five workers 
are far more numerous and crucial in terms of providing employ- 
ment. Small-scale establishments engage in a wide range of activi- 
ties from traditional bamboo weaving to metal and leather working. 
Many of these industries offer part-time employment to rural work- 
ers during off-peak seasons. In 1986 small-scale industries employed 
3.9 million workers, corresponding to 67 percent of total industrial 
employment, twice as many as in large and medium- sized firms. 
Still, this figure reflected a significant decline from the 1970s, when 
small-scale industry accounted for 86 percent of total industrial 
employment. By 2004 the number of small-scale enterprises was 
around 250,000, and together they employed 1.8 million workers, 16 
percent of the industrial labor force. The foremost branches were 
food and beverages, including tobacco, with about 33 percent of 
these workers, followed by wood and textiles, including footwear, 
each of which accounted for slightly more than 20 percent. Labor 
productivity has remained relatively low in small-scale industry. In 



209 



Indonesia: A Country Study 

2004 value-added contributions in this sector amounted to only 
Rpl2 million (about US$1,342) per worker, as compared with Rp77 
million (about US$8,614) in large and medium-sized firms. Foster- 
ing small-scale manufacturing is especially important in terms of 
generating employment, whereas a successive upgrading of technol- 
ogy is more easily achieved by stimulating large and medium-sized 
units of production. 

The considerable productivity gap compared to larger industrial 
enterprises has slowed in the development of small-scale industry. 
Differentials of 1:10, or even more, have been reported, with few 
signs of improvement. The New Order policy of supporting small- 
scale industry through sponsorship or partnership relationships with 
bigger firms evolved in the early 1990s and officially launched in 
1996, but it had little effect when the financial crisis caused priorities 
to be shifted elsewhere. 

Minerals 

Indonesia is the leading producer of petroleum in Southeast Asia 
and has the world's tenth-largest proven natural gas reserves, 70 per- 
cent of which are offshore. It exported 16 percent of the world's total 
volume of LNG in 2005, but more recent reports indicate that the 
share is diminishing. It also has significant reserves of other valuable 
minerals, such as bauxite, coal, copper, gold, nickel, and tin. Much 
of the nation's industrial development, however, is based on the pro- 
cessing of oil and natural gas. Most mineral production, after some 
degree of domestic processing, is exported to industrial nations, 
especially Japan. Some of Indonesia's own mineral-intensive indus- 
tries, notably, steel and aluminum, rely on imports of raw materials. 
On balance, however, Indonesia is a net exporter of minerals, in 
large part because of large-scale exports of LNG. 

Petroleum and Natural Gas 

Between 1962 and 2009, Indonesia's oil production was formally 
governed by a quota allocation from the Organization of the Petro- 
leum Exporting Countries (OPEC — see Glossary). In 2005 Indone- 
sian output of crude oil amounted to about 1.1 million barrels per 
day, corresponding to 3.5 percent of OPEC's total production. This 
was about 20 percent less than the level of crude output in 1999 and 
also failed to meet the allocated OPEC quota of 1 .4 million barrels 
per day. In 2006 the crude oil output fell below 1 million barrels per 
day. Experts attribute the decline in output to a slowdown in invest- 
ment and declining productivity. With oil exports governed at least 



210 



The Economy 



in part by long-run contractual agreements and domestic fuel con- 
sumption increasing rapidly as Indonesia shook off the effects of the 
Asian financial crisis, oil imports into the country in the early 
twenty-first century were rising at a rate considered alarming by out- 
side observers. The increase from 2004 to 2005 amounted to 30 per- 
cent, and purchases of foreign oil, in both crude and refined forms, 
corresponded to 22 percent of total expenditures on imports in the 
latter year. Exports looked likely to increase with production com- 
mencing from the Cepu oil field in Jawa Tengah Province. 

Indonesia's oil industry is one of the oldest in the world. The two 
pioneering oil firms in the then-Dutch colony, Royal Dutch and the 
British company Shell, exploited reserves in eastern Kalimantan and 
northern Sumatra starting in the late 1890s. The firms, which in 1907 
forged an alliance, Royal Dutch Shell, virtually monopolized the oil 
sector through joint subsidiaries for production and distribution for 
several decades in the twentieth century. Two American rivals, Stan- 
dard-Vacuum Oil Company (Stanvac) and California Texas Oil Com- 
pany (Caltex), gained prominence shortly after independence in 1945 
and survived into the Suharto era; Royal Dutch Shell withdrew from 
Indonesia in 1965. By the 1990s, five of the six largest foreign oil com- 
panies operating in Indonesia were American-owned. For decades, 
exploitation of Indonesia's oil and gas reserves has taken place under a 
production-sharing arrangement between the government and foreign 
oil companies, by which the state-owned enterprise Pertamina dis- 
burses the bulk of output, retaining for itself the proceeds from sales in 
international markets. A smaller part of output serves to recover the 
costs of investment and operations incurred by the foreign firms. Ini- 
tially the ratio was 65:35, but the Suharto government negotiated a 
shift to 85:15. Contract terms for Indonesian oil have been considered 
among the toughest in the world. 

Annual oil production expanded quickly in response to rising 
world prices during the 1970s, reaching a peak of almost 1.7 million 
barrels per day in 1977. Prices continued to soar until 1982, when a 
gradual decline set in, culminating in the sharp drop in world oil 
prices of 1986. Total production in the late 1980s amounted to 
around 1 .2 million barrels per day. Production then increased, aver- 
aging 1.35 million barrels per day over the 1991-99 period. A grad- 
ual decline followed, to slightly more than 1 million barrels per day 
by 2003-5, dropping below that benchmark in early 2006. It seemed 
probable that Indonesia might become a net importer of crude oil, 
which indeed occurred temporarily in 2008, and since January 2009 
Indonesia has suspended its membership in OPEC. 



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Indonesia: A Country Study 

By the 1990s, Pertamina was operating eight large oil refineries, 
in Sumatra, Kalimantan, and Java. Major investments negotiated in 
the first years of the twenty-first century involved the new exploita- 
tion of offshore oil reserves in Jawa Timur and Kalimantan Timur, as 
well as the construction of long pipelines connecting southern Suma- 
tra, Java, and eastern Kalimantan. The Indonesian government con- 
tinues to subsidize domestic fuel prices at well below international 
market prices. 

Natural gas fields exist in the Special Region of Aceh, the Natuna 
Islands in Kepulauan Riau Province, and in Kalimantan Timur and 
Papua Barat provinces. After conversion to LNG — a refrigeration 
process that reduces it to 1 /600th of its volume — the gas is exported 
primarily to Japan, South Korea, and Taiwan, and increasingly to 
China. Conversion facilities were constructed in the late 1970s at 
Lhokseumawe (in Aceh) and Bontang (in Kalimantan Timur) and, in 
the late 2000s, in Bintuni Bay (in Papua Barat). The total capacity of 
these plants reached 23 million tons by 1990. Continued expansion 
brought the total to a peak of 32 million tons in 1999, and by the 
beginning of the twenty-first century the level of output had stabi- 
lized at an annual average of 27.5 million tons. Indonesia supplies as 
much as 15 percent of the natural gas produced by OPEC members. 

Most output goes to liquefying plants for export, although a grow- 
ing proportion is needed for domestic consumption, especially of 
fertilizer, the production of which requires that natural gas be pro- 
cessed into ammonia and urea. Growing domestic and export 
demand have encouraged the development of the gas field in the 
Natuna Islands in the South China Sea and the Tangguh gas field in 
Bintuni Bay. 

Other Minerals 

The New Order government made efforts to rejuvenate the coal 
industry, mainly located in the provinces of Sumatera Barat, Sumatera 
Selatan, and Kalimantan Timur, so as to encourage coal use by, for 
example, cement and electric-power plants. Joint ventures between 
the state and foreign investors have resulted in a steady increase in 
production. Output exceeded 50 million tons in 1997 and climbed to 
more than 100 million tons in 2002. 

Another extractive industry dating from the colonial period is tin 
mining, based on the islands of Bangka and Belitung (Bangka-Belitung 
Province) in the Java Sea off the southeastern coast of Sumatra. Along 
with Malaysia and Bolivia, Indonesia is one of the world's top-three 
producers of tin. Production was fully controlled by the government 
starting in the late 1950s, but it stagnated in the early Suharto period, 



212 




Freeport-McMoRan s Grasberg copper and gold mine, Papua Province 
A bulk carrier ship at Timika, upriver from the seaport of Amamapare 

Courtesy Freeport-McMoRan 



213 



Indonesia: A Country Study 

with output falling below 30 million tons annually throughout most of 
the 1980s. A gradual increase followed in the 1990s as a result of new 
investment in production capacity, and by 2000 Indonesia was produc- 
ing 50 million tons per year. Rising tin prices on the world market 
caused a further increase by 2006 to a level in excess of 81 million tons. 

Another postindependence development in the mineral industry 
was nickel mining in Sulawesi Tenggara Province, where a Canadian 
investor entered into a joint venture with the government. In the 
1980s, Indonesia emerged as one of the world's top-five producers 
of nickel. Capacity increased to 2.5 million tons per year in the early 
1990s and substantially enlarged during the first couple of years of 
the twenty- first century, nearing a level of 4.4 million tons by 2003. 

One of the world's most spectacular mines is the huge P. T. Free- 
port-Indonesia copper and gold mine, located atop Ertsberg Moun- 
tain near Tembagapura, Papua Province. Since the beginning of the 
Suharto period, the mine has been run by a joint venture with the 
U.S. -based Freeport-McMoRan Copper and Gold. The ore is trans- 
ported by pipeline 96 kilometers down the mountain slopes and 
through the rain forest to Freeport's port of Amamapare for export. 
A second mine, on nearby Grasberg Mountain, came online in the 
early 1990s. Both Ertsberg and Grasberg are north of the city of 
Tembagapura. Much attention has been given in the news media to 
the environmental degradation resulting from this kind of open-cast 
mining and also to confrontations between the American enter- 
prise — protected by the Indonesian military — and the local Papua 
population concerning land use and the exploitation of the region's 
natural resources. Given its participation in the equity of the Freeport 
subsidiary, the Indonesian government has always had high profits at 
stake. Total copper production has risen rapidly, climbing to more 
than 1 million tons in 1994, reaching 2.5 million tons per year in the 
late 1990s, and approaching 4 million tons per year by 2002. In 
2007, however, total output fell below 3 million tons. 

Other Indonesian mineral products also are important. They 
include gold, mainly extracted as a by-product at the Freeport copper 
mines, and bauxite found on Bintan Island in Kepulauan Riau Prov- 
ince, used in the domestic production of aluminum. 

Services and Infrastructure 

In the first years of the twenty-first century, service industries pro- 
vided jobs for about 40 million Indonesians, corresponding to 39 per- 
cent of the total labor force, a proportion that had risen only 
marginally since the 1990s. About 50 percent of these jobs were in 
trading, hotels, and restaurants; 33 percent were in a variety of com- 



214 



The Economy 



munity, social, and personal services; and the remainder, approxi- 
mately 17 percent, were mostly in the transportation, communications, 
and storage sectors. Jobs in finance accounted for less than 2 percent 
of total employment in the services sector. Indonesia also had about 4 
million civil servants at all levels of government. A large proportion 
of work in the services sector, about 70 percent, consisted of informal 
employment. Petty traders made up the majority of the informal sec- 
tor, and unincorporated establishments accounted for as much as 90 
percent of employment in commerce. Ubiquitous self-employed 
small-scale traders plied their wares in village markets and on urban 
streets. 

The government's attitude toward the informal sector has often 
been ambivalent. On the one hand, its importance as a source of 
employment required support as part of the overall effort to promote 
pribumi entrepreneurship. On the other hand, policies often thwarted 
informal-sector activities. For example, the once common becak 
(pedicab) was restricted to small side streets in many urban areas and 
phased out altogether in Jakarta. 

Transportation 

An elaborate upgrade of the long-neglected transportation infra- 
structure began in the 1970s. The physical infrastructure, such as 
roads, railroads, ports, and airports, was significantly expanded and 
improved with the aid of burgeoning revenues from oil exports. This 
process slowed in the 1990s and came to a complete halt during the 
financial crisis and subsequent recovery. In 2005 attention focused 
on reconstruction in the Special Region of Aceh after the damage 
caused by the December 26, 2004, tsunami. Outlays for infrastruc- 
ture alone in 2005 were estimated at US$660 million. In early 2006, 
the government announced a new package for infrastructure devel- 
opment at a total cost of US$48 billion during the subsequent five- 
year period. 

Roads 

Indonesia had some 437,760 kilometers of roads by 2008, of 
which 59 percent were paved, and about 60 percent were located in 
Java, Madura, Bali, and Sumatra (see fig. 10). There are less exten- 
sive networks of roads in Sulawesi and Kalimantan, while smaller 
islands often have just a few roads within or connecting major settle- 
ments. About 40,000 kilometers of roads administered by the national 
and provincial governments were considered to be in good condition; 
another 35,000 kilometers were in varying stages of repair. About 32 
percent of the nation's roads are classified as highways. 



215 



Indonesia: A Country Study 

The nation's roads and highways are used annually by some 5.5 
million passengers cars, 1.2 million buses, 2.9 million trucks, and 
28.5 million motorcycles. Motor vehicles increasingly dominate 
urban transit, and in major cities the policy is to increase the role of 
larger public buses over that of privately owned, smaller-capacity 
vehicles such as the nine-seat Opelet microbus and the six-seat 
Bemo. The formerly ubiquitous becak has been largely replaced in 
the major cities by the bajaj, a three-wheeled, multipassenger motor- 
cycle, which itself is losing ground to minibuses and automobiles. In 
Jakarta the increased use of private vehicles contributes to urban 
sprawl, ever-greater traffic congestion, and air pollution. 

Vehicular congestion and automotive emissions are increasing, 
particularly in urban areas. Some new toll roads were constructed in 
the 1990s, such as the one between Jakarta city center and Sukarno- 
Hatta International Airport to the west and the industrial areas around 
Cikarang and Cikampek to the east. However, such developments fell 
far short of keeping up with rapidly expanding demand, and new proj- 
ects were shelved altogether when the financial crisis struck in 1997, 
resuming only after several years of recovery. A toll road opened in 
2005 significantly reduced travel time between Jakarta and Bandung, 
the nearest major city to the capital. Newly constructed toll roads con- 
nect Semarang and Surakarta (also known as Solo) in Jawa Tengah 
Province and improve access to Pasuruan in Jawa Timur. Investment 
in a mass public-transport system in Jakarta lagged behind develop- 
ments in other Southeast Asian capitals such as Bangkok, Kuala Lum- 
pur, Manila, and Singapore. A system of priority bus lanes introduced 
in 2005 has offered a temporary solution. In 2004 construction started 
on an elevated, two-line monorail serving Jakarta's central business 
district and suburban areas east and west of the city. Completion of 
the monorail, scheduled for 2007, was delayed with construction 
barely underway in 2008, and little progress was made thereafter. 
Administrative hurdles and disputes over land generally are cited as 
factors that severely slow down investment in the transportation infra- 
structure in Indonesia. 

Railroads 

In 2008 Indonesia had 8,529 kilometers of railroad track, all of it 
owned by the government and operated by the Department of Trans- 
port, a gain of more than 30 percent since 2006. About 75 percent of 
railroad track is located in Java. In 2006 most of the track (5,961 kilo- 
meters) was 1.067-meter narrow gauge, 125 kilometers of which was 
electrified in 2006; the rest (497 kilometers) was 0.750-meter gauge. 
Although trains are used mostly for passenger transportation, freight 



216 



The Economy 



haulage has made significant advances, having increased to more 
than 17 million tons by 2005, a gain of 50 percent over the level of 
the early 1990s. Rail transportation is especially suited to hauling 
bulk items such as fertilizer, cement, and coal, and freight has proved 
more profitable than passenger service. Sumatra accounts for 75 per- 
cent of freight handling. In 2007 railroads carried about 175 million 
passengers, 97 percent of whom boarded trains in Java. 

Shipping 

Maritime transportation experienced major investments and various 
reforms in the 1980s after growing increasingly restrictive and bureau- 
cratic during preceding decades. The Indonesian National Shipping 
Company (Pelni) had been established in 1952 but gained the upper 
hand in interisland shipping only after the nationalization of the 
Dutch-owned shipping company in 1959. By 1965 Pelni accounted for 
50 percent of tonnage in interisland shipping, but its market share 
declined sharply despite a virtual monopoly on passenger travel. In 
1982 a "gateway policy" was introduced in order to discourage trans- 
shipment via Singapore and direct Indonesia's nonbulk exports 
through four designated deep-sea ports: Tanjung Priok (Jakarta), Tan- 
jung Perak (Surabaya, Jawa Timur Province), Belawan (Medan, 
Sumatera Utara Province), and Makassar (formerly Ujungpandang, in 
Sulawesi Selatan Province). The protectionist measures were accom- 
panied by a US$4 billion investment plan launched in 1983 that in par- 
ticular favored upgrading facilities at the four gateway ports. 
However, such a gateway policy became irrelevant as exports were 
increasingly handled by container shipping. By 1987 Indonesia's trade 
with North America and Europe moved almost exclusively via trans- 
shipment in Singapore. In fact, the closing of Indonesian ports to 
feeder vessels denied Indonesian shippers the benefits of lower freight 
rates made possible by the cargo consolidation at Singapore. By the 
late 1980s, the gateway policy had been abandoned. 

Total freight volume handled by some 95 commercial Indonesian 
ports reached a total of 1 .2 billion tons by 2004, 75 percent of which 
went to foreign destinations. The greatest volume passed through 
ports adjacent to oil refineries: 30 million tons at Dumai, Riau Prov- 
ince, and 22 million tons at Balikpapan, Kalimantan Timur Province. 
By contrast, the four main ports in Java — Tanjung Priok (Jakarta), 
Tanjung Perak (Surabaya), Semarang, and Cilacap — were together 
responsible for just 30 million tons. In addition to major ports, there 
are more than 30 other significant ports supporting interisland mari- 
time trade throughout the archipelago. 



217 



Indonesia: A Country Study 




The Economy 



Civil Aviation 

Although passenger transportation by sea still exceeded domestic 
air travel in 2002, with 17 million passengers compared to 12 million, 
by 2007 civil aviation had become of far greater importance. In that 
year, 3 1 million passengers boarded an airplane compared with only 
6 million using sea transport. The phenomenal increase in domestic 
air travel in the early twenty-first century was caused by a prolifera- 
tion of private budget airlines linking all parts of the archipelago and 
making air travel affordable for large groups of new customers. By 
comparison, international arrivals by air increased from 4.3 million 
passengers in 2000 to 5.3 million in 2004 and then declined to 4.5 
million by 2007. Civil aviation is handled by the state-owned national 
carrier, Garuda Indonesia, which dates from 1949; its subsidiary, 
Merpati Nusantara Airlines; and a host of private budget airlines, 
which expanded from three in 2000 to 29 by 2005. 

The enlargement of physical infrastructure in the late 1970s and 
early 1980s included construction of airports throughout the archipel- 
ago so that every provincial capital was within hours of Jakarta. The 
hub, Sukarno-Hatta International Airport at Jakarta, opened in 1985 
and was followed by international airports in Denpasar, Bali (Ngurah 
Rai), Surabaya, Jawa Timur (Juanda), and Medan, Sumatera Utara 
(Polonia). In 2009 Indonesia had 683 airfields, 164 of which were 
full-fledged airports, including at least 22 designated as international. 
There also were 36 heliports. The largest numbers of passengers dis- 
embarked at Jakarta, Surabaya, Medan, and Denpasar. Runways at 
least 3,000 meters long were available in Medan, Padang, Jakarta, 
Surabaya, Denpasar, and Biak (Papua Barat Province). Besides these 
major airports, Indonesia is well served by 35 or more significant air- 
ports. In this regard, Papua is particularly well served. 

Post and Telecommunications 

The national postal system is the most important means of commu- 
nication for the majority of citizens. Postal services are available in all 
subdistricts, and, by the first years of the twenty-first century, the total 
number of post offices had increased to 7,000 from fewer than 3,000 in 
1980. Having invested early in satellite communications, since the 
1980s Indonesia has possessed a sophisticated telecommunications 
infrastructure. It is supported by the Palapa system of satellites (the 
name signifies unity). The first two Palapa- A satellites were launched 
in 1976; they were successfully replaced by Palapa-B satellites in 
1987. The first Palapa-C was launched in January 1996, and a second 
in May 1996, providing coverage not only for the Indonesian archipel- 
ago but also for Malaysia, the Philippines, and Singapore. Formerly 



219 



Indonesia: A Country Study 

government-owned, the Palapa system was acquired by a private- 
sector company, Satelindo, established in 1993. The system includes 
international direct-dialing facilities and a fully integrated national tele- 
phone system. By 2007 there were 17.8 million main telephone lines in 
use, and the number of mobile phones had reached 81.8 million. 
Although there are more than 200,000 telephone kiosks, many located 
in remote areas, recent expansion has almost entirely been in mobile- 
phone connections. The number of mobile-phone subscribers more 
than doubled between 2004 and 2007, whereas only 12 million inhabit- 
ants, less than 6 percent of the total population, had access to a fixed 
telephone line. Privatization of the telecommunications sector has 
facilitated competition and reduced costs for the consumer. 

Television and radio traditionally have been dominated by govern- 
ment networks, but private commercial channels have been emerging 
since the introduction of Hawk Television Indonesia (RCTI) in the 
Jakarta area in 1988. By early in the new century, the improved com- 
munications system had brought television signals to every village in 
the country, and most Indonesians could choose from 1 1 channels. In 
addition to the state-owned Television of the Republic of Indonesia 
(TVRI), there were 10 national private channels in 2009. The best 
known are Indosiar, RCTI, Sun Television (SCTV), Metro TV, and 
Trans 7. Some channels have a specific orientation, for instance, Global 
TV, which initially offered broadcasts from MTV Indonesia, and Indo- 
nesian Educational Television (TPI), which originally carried only edu- 
cational programming but expanded into quiz programs, sports, reality 
shows, and other popular entertainment. There also were 54 local tele- 
vision stations in 2009, such as Bali TV in Bali, Jak TV in Jakarta, and 
Pacific TV in Manado. There were about 3,000 live radio stations 
throughout Indonesia, but only a few broadcast nationally. Examples 
include Jakarta News, Sonara, and Prambors in the nation's capital; 
JJFM, Radio DJ, and Radio Istra in Surabaya; Swaragama in Yogya- 
karta; and Global FM Bali in Denpasar. 

Internet usage has surged since 2000, when there were 2 million 
users. In 2009 there were nearly 30 million users, a 1,500-percent 
increase since the start of the twenty-first century. Indonesia has the 
most Internet users among all other Southeast Asian nations. 

Electric Power 

As it had been for many years, the government-owned National 
Electric Company (PLN) was virtually the sole source of electricity 
for domestic consumption in the early twenty-first century. Capacity 
had been growing at a rate of 15 percent per year since the 1970s and 
was especially enhanced by the addition of large coal-fired generating 



220 



The Economy 



facilities at Paiton, Jawa Timur Province, in the late 1990s. Industry 
tended to use almost 50 percent of domestically generated power. By 
2004 total installed capacity amounted to 22,000 megawatts, and 
PLN had more than 40,000 employees. There was a slowdown in the 
expansion of capacity and production during the Asian financial cri- 
sis, but starting in 2000 production growth again achieved annual 
increases of 10 percent or more. 

Economic Prospects 

The big challenge for Indonesia in the early twenty-first century is 
to resume rapid economic growth while retaining the achievements of 
reform and democratization won since the collapse of the New Order 
government in 1998. This is no easy task. Short-run prospects for 
major macroeconomic variables looked quite favorable at the end of 
the first decade of the twenty-first century. Production capacity was 
being enlarged as a result of new investment, the current account in 
the balance of payments was improving, the exchange rate had 
reached a stable level, inflation was slowing, and the government bud- 
get deficit had been significantly reduced. An average annual growth 
rate in the 6 to 6.5 percent range appeared possible, with 6.2 percent 
specified as the target for 2010. That would be sufficient to reduce 
poverty and official unemployment to the levels laid down in the 
long-run economic plans. But such positive prospects were offset by 
external and internal uncertainties. Continued high oil prices in the 
world economy could have an adverse effect on the prices of imports 
in general and put an additional strain on foreign-exchange earnings if 
Indonesia were indeed to stay a net importer of fuels. Another external 
source of uncertainty was the excessive dependence of the Indonesian 
capital market on short-run foreign portfolio investments with an 
inclination toward high sensitivity to sudden fluctuations in expecta- 
tions. The most crucial internal source of uncertainty concerned the 
government's capability to create sound business conditions. Progress 
was urgently needed in combating corruption and guaranteeing legal 
security for both foreign and domestic firms. The administration of 
President Susilo Bambang Yudhoyono, who took office in 2004 and 
was reelected in 2009, initially enjoyed considerable credit for its 
determination to tackle these huge problems, but signs of disappoint- 
ment with the slow pace of progress have been mounting. 

The three chief trends in Indonesian economic development since 
the late 1 960s — increasing integration with the world economy, pro- 
found structural change, and intense diversification — remain rele- 
vant to an assessment of long-term prospects in the twenty-first 
century. Further integration with the world economy is expected to 



221 



Indonesia: A Country Study 

be strengthened, in particular, following the accelerated implementa- 
tion of AFTA, which was moved up from 2008 to 2002. Already by 
2006 the average tariff rate on imports in the five original ASEAN 
member states (plus Brunei) for goods covered by the AFTA agree- 
ment had declined to less than 2 percent from 12 percent in the early 
1990s. The successful reduction of tariffs prompted the formulation 
of a single market, the ASEAN Economic Community, as an official 
target to be achieved by 2015. Structural change, notably the shift of 
resources from the primary to the secondary sector, was temporarily 
halted by the 1997-98 financial crisis and its aftermath but is likely 
to gain momentum as rapid economic growth resumes. Further 
diversification of the economy is likely to occur and may be rein- 
forced when economic effects materialize from the far-reaching 
decentralization of government authority that became effective in 
2001. In the process, however, regional disparities may be widened. 
It will be a major challenge for the central government to give sub- 
stance to its motto "Unity in diversity," which has so often been 
applied to the Indonesian society and economy. 

* * * 

The quality of statistics on the Indonesian economy has improved 
substantially, and a wide range of publications, often in bilingual format, 
are available from the BPS Web site in Jakarta (http://www.bps.go.id/). 
The annual reports issued by the central bank, Bank Indonesia, contain a 
wealth of information on current economic conditions. In addition, the 
World Bank prepares an elaborate analysis of the nation's economic 
prospects each year. The Far Eastern Economic Review (Hong Kong, 
formerly published weekly and now monthly) and daily Asian Wall 
Street Journal (Hong Kong) offer less scholarly but more up-to-date 
information. Most informative journals published in Indonesia are in the 
Indonesian language. 

The most accessible and up-to-date source in the secondary literature 
is the Bulletin of Indonesian Economic Studies, published by the Indone- 
sia Project at the Australian National University in Canberra. Each issue 
opens with a "Survey of Recent Developments," a tradition sustained 
since the journal was founded in the 1960s that provides a succinct over- 
view of the most current data and issues. The Indonesia Project also 
organizes an annual conference on various aspects of the Indonesian pol- 
ity and economy, the "Indonesia Update," which has resulted in a series 
of conference proceedings published under the title "Indonesia Assess- 
ment" until 2001 and thereafter as "Indonesia Update Series," available 
at http://rspas.anu.edu.au/economics/ip/publications.php. 



222 



The Economy 



Authoritative surveys of Indonesian economic history include one 
written by Anne Booth, The Indonesian Economy in the Nineteenth 
and Twentieth Centuries: A History of Missed Opportunities, and 
another by an international team of scholars, Howard Dick, Vincent 
J. H. Houben, J. Thomas Lindblad, and Thee Kian Wie, The Emer- 
gence of a National Economy: An Economic History of Indonesia, 
1800-2000. Anne Booth's The Oil Boom and After: Indonesian Eco- 
nomic Policy and Performance in the Soeharto Era is a comprehen- 
sive summary of economic developments. It replaced an earlier 
version coedited with Peter McCawley, The Indonesian Economy 
During the Soeharto Era, but was itself superseded by a full-fledged 
monograph, Hal Hill's The Indonesian Economy. The vast literature 
on the Asian financial crisis includes numerous publications on 
Indonesia. An early and especially useful summary was offered by 
Hal Hill in The Indonesian Economy in Crisis. Two other mono- 
graphs on more specific topics were of particular importance to this 
chapter, one on political economy, Richard Robison's Indonesia: 
The Rise of Capital, and the other on labor relations by Chris Man- 
ning, Indonesian Labour in Transition: An East Asian Success Story. 

Authoritative and durable Web sites posted in Indonesia include those 
of the Central Statistical Office (http://www.bps.go.id), the National 
Development Planning Board (http://www.bappenas.go.id), Bank Indo- 
nesia (http://www.bi.go.id), and the Capital Investment Coordinating 
Board (http://www.bkpm.go.id). A highly useful nongovernmental doc- 
umentation center is the Centre for Strategic and International Studies in 
Jakarta (http://www.csis.or.id); the best university collection of materials 
is found at the Web site of the Universitas Indonesia in Jakarta (http:// 
www.ui.ac.id). Several international organizations maintain Web sites 
offering a wealth of information on Indonesia. Two leading examples are 
the ASEAN secretariat in Jakarta (http://www.aseansecr.org) and the 
Asian Development Bank in Manila (http://www.adb.org). (For further 
information and complete citations, see Bibliography.) 



223 



Chapter 4. Government and Politics 




A precolonialJavanese jong 



PRESIDENT SUHARTO RESIGNED IN 1998, and Indonesia began 
a transition to democracy, a process that has had the country strug- 
gling to establish a new political identity. This struggle has taken 
place on four fronts: executive-legislative relations, center-region 
relations, religion-state relations, and interethnic relations. A slow 
but eventually successful process of constitutional reforms from 1999 
to 2002 addressed the first three fronts. Political elites in the People's 
Consultative Assembly (MPR; for this and other acronyms, see table 
A) established a strongly presidential system with directly elected 
national and local chief executives, stronger legislatures, and an inde- 
pendent judiciary, as well as a decentralized political system with sig- 
nificant local autonomy. They also maintained Indonesia's identity as 
a plural, tolerant, and moderate Muslim-majority society with signifi- 
cant non-Muslim minorities, but not an Islamic state. This vision was 
sorely tested by the passage in some districts of local regulations 
implementing parts of Islamic law — sharia, or syariah in Bahasa 
Indonesia (see Glossary) — and by the Al Qaeda-linked terrorist 
attacks in Bali and Jakarta from 2002 to 2009. Indonesian citizens 
heartily endorsed these changes through their broad, enthusiastic, and 
largely nonviolent participation in the 1999, 2004, and 2009 electoral 
processes. The constitutional reform process indicated little on the 
fourth front, interethnic relations, except that Indonesia was still to be 
a state based on Pancasila (see Glossary), the five-point pan-religious, 
pan-ethnic state ideology created by the first president, Sukarno (in 
office 1945-67). Indonesians have struggled to overcome deadly 
communal strife in Maluku, Sulawesi, and Kalimantan, among other 
places, but by 2009 much of this violence had receded. 

Consolidation of the new democracy remains a significant chal- 
lenge. By the end of the first decade of the twenty-first century, 
reforms in the national-security sector were only partial at best. The 
military and police remained neutral in elections between 1999 and 
2009, and they were stripped of their appointed seats in legislatures at 
all levels. The system of secondment of military officers to the civilian 
bureaucracy was also abolished. However, the roots of the military's 
political influence — the territorial system, business ventures, and the 
lack of democratic civilian oversight — only began to be addressed 
under the leadership of President Susilo Bambang Yudhoyono, who 
took office in 2004. The police were organizationally separated from 
the military in 1999 and have done a respectable job of addressing the 
threat of terrorism, but for most Indonesian citizens, daily interactions 



227 



Indonesia: A Country Study 

with the police have not been reformed: overall, corruption and inef- 
fectiveness remain widespread. The implementation of decentraliza- 
tion, including revised autonomy laws passed in 2004 and the direct 
election of regional chief executives (governors, mayors, and district 
administrative heads or regents — bupatis) beginning in 2005, created 
its own problems, as corruption also has been decentralized, and the 
national government is confronted with a host of local regulations that 
are inconsistent with national laws and the constitution. Executive- 
legislative relations are frequently contentious, as the president and 
the legislative branch establish a working relationship within the new 
constitutional parameters and the legislature itself adjusts to the pres- 
ence of a new upper house, the Regional Representative Council 
(DPD), established in 2004. Internal reform of these entities, to unclog 
the process of enacting laws and strengthen institutional capacity, is a 
pressing need. 

Corruption has tainted every branch and level of the state: the civil- 
ian bureaucracy, the military and police, the legislatures, and the judi- 
ciary. Efforts to root out corruption, including the passage of new laws 
and regulations and the establishment of an array of commissions, 
have been only partially effective. Nonetheless, for ordinary citizens, 
fighting corruption remains a matter of primary concern, particularly 
the corruption they experience on a day-to-day basis at the village or 
ward offices, schools, government offices, courts, and police stations. 
Private investors, both domestic and foreign, are reluctant to commit 
their capital to Indonesia because of the high cost of doing business 
and the lack of consistent contract enforcement by a clean and impar- 
tial judiciary. 

The new political system that President Yudhoyono inherited has 
made dealing with these pressing issues more complex than previ- 
ously. Legislatures are more independent of the executive branch, and 
there are now two legislative bodies at the national level. Provincial 
and district governments are more powerful and have greater auton- 
omy vis-a-vis the central government. The judicial system is no longer 
under the administrative and political control of the executive branch. 
The military retains significant latent political influence. Nonetheless, 
the success of the 2004 electoral process gave the new system broad 
legitimacy, and, again in 2009, Yudhoyono enjoyed a strong popular 
mandate from voters to move the country forward. 

Foreign policy is frequently a significant issue in domestic politics, 
particularly when it concerns relations with the United States, Austra- 
lia, or the complex tangle of problems in the Middle East. Yudhoyono 
has had to navigate these political minefields, given his ties to the 
United States from his prior military career and his cultivation of a 



228 



Government and Politics 



profile as a secular nationalist rather than an Islamist politician 
(although he is personally pious). When Indonesia cooperates with 
the United States and Australia on counterterrorism measures, the 
Yudhoyono administration has to be careful not to be labeled as an 
agent of a perceived Western "war on Islam." Indonesia has also had 
to balance maintaining good relations with the West with supporting 
the Palestinian cause and opposing the U.S. -led war in Iraq. Indone- 
sia has contributed troops, including Yudhoyono's elder son, to the 
United Nations (UN) peacekeeping force in Lebanon, while simulta- 
neously preventing private citizens from volunteering to fight beside 
Hezbollah in the 2006 war with Israel. 

When Indonesia's international treaty obligations have come into 
conflict with expressing solidarity with a fellow Muslim nation — for 
example, its March 2007 vote to approve UN Security Council Reso- 
lution 1747 on Iran's nuclear- weapons program — the government has 
been harshly criticized at home as a tool of Western interests. The 
legislature has also attempted to force the president to face question- 
ing regarding this vote. In the late New Order period under President 
Suharto (in office 1967-98), Indonesia had begun to project a more 
assertive presence in the international arena, corresponding to its 
large population, strategic location, abundant natural resources, eco- 
nomic success, and growing nationalism. After a setback of a decade 
of focusing inward to solve its political and economic crisis, by 2008 
Indonesia began to reassert itself on the global stage as a generally 
constructive force, offering to help solve conflicts ranging from the 
Korean Peninsula to Iran, from Burma (Myanmar) to Iraq. Indone- 
sia's good relations with independent Timor-Leste (East Timor, for- 
merly Timor Timur Province of Indonesia), and its implementation of 
a peace agreement in the Special Region of Aceh, have helped bolster 
its case to play this role, largely free of criticism over its own nagging 
human-rights issues. 

The Political Debate 

Indonesia has been a magnet for students of comparative politics 
as well as foreign diplomats and policy makers ever since indepen- 
dence from the Netherlands was declared in 1945. Fascination with 
Indonesia stems in part from its large population (estimated at more 
than 240 million people in 2009), strategic location, economic poten- 
tial, great cultural and ethnic diversity, and fragmented archipelagic 
geography confounding centralized administration. Equally compel- 
ling is Indonesia's tumultuous political history, from Indianization 
and Islamization to Dutch colonialism and an often violent decoloni- 
zation process. 



229 



Indonesia: A Country Study 

Contemporary Indonesian political history can be divided into four 
periods, each defined by a central issue. First, during the 1950s, there 
was the question of the political integrity of the state itself, beset as it 
was by religious, regionalist, and ethnic revolts and rebellions. Sec- 
ond, and of great concern to U.S. policy makers, was the drift that 
became a rush to the left and the Indonesian Communist Party 
(PKI — see Glossary) during the period of Sukarno's Guided Democ- 
racy (1959-65). Third, from 1966 to 1998, there was the develop- 
mentalist authoritarianism of Suharto's army-dominated New Order. 
Finally, since 1998, the yeaf Suharto left the presidency, the success- 
ful transition to and ongoing consolidation of liberal democracy has 
provided inspiration for reformers and democrats in other Muslim- 
majority societies. 

The political transition in Indonesia has produced a requisite 
change among academic observers of Indonesian politics: Indonesia 
has become a "normal" country that can be examined with all of the 
standard theoretical and methodological tools available. As before, 
some continue to debate the basic nature of the Indonesian state. 
Others, however, adopt a more micro-analytical approach, examin- 
ing trends in various policy areas, public opinion, etc., an approach 
that had been greatly hampered under the previous authoritarian 
regime. In addition to providing more varied empirical fodder for 
research, democratization in Indonesia has also resulted in much 
greater freedom for researchers to conduct their studies. One conclu- 
sion on which most observers have agreed is that the complexity, 
number, and interdependence of various social, cultural, economic, 
and political factors are so great that no single theory suffices. 

Harking back to previous debates regarding the basic nature of the 
Indonesian state, one of the broadest current discussions concerns 
whether the still-fragile democratic order can be consolidated and sus- 
tained. Some scholars argue that the relatively nonviolent and gradual 
nature of the transition bodes well for the future of Indonesian democ- 
racy. As positive signs in this regard, they point to the success of the 
national elections in 1999, 2004, and 2009; the acquiescence (however 
grudging) of the security forces to the establishment of democracy; 
and the consensual process and broad scope of the constitutional 
reforms passed between 1999 and 2002. Others posit that it is pre- 
cisely the lack of a cleaner and deeper break with the past that has cre- 
ated internal contradictions that may doom the new democracy. For 
instance, a substantial level of continuity in the political, military, 
bureaucratic, and economic elite has meant that old habits have been 
adapted to the new institutions and retained their strength, ensuring the 
superficiality of institutional change. There has been little accountabil- 
ity, especially at the highest levels, for the political and economic sins 



230 



Government and Politics 



of the New Order, fostering simmering resentments that could one day 
be tapped as a reservoir of opposition to democracy itself. Most 
importantly, despite a number of successful high-level prosecutions, 
rampant bureaucratic, military, legislative, and judicial corruption 
remains the most significant factor keeping private foreign investors 
on the sidelines. Their absence lowers economic growth rates, which 
in turn hampers the performance legitimacy of the new democratic 
regime. Whatever approach is used to describe and analyze Indonesian 
government and politics, it requires an understanding of the legal basis 
and institutional structures of the system. 

The Constitutional Framework 

The legal basis of the Indonesian state is the 1945 constitution, 
promulgated the day after the August 17, 1945, proclamation of inde- 
pendence from the Netherlands and amended four times between 
1999 and 2002. The original constitution was essentially a temporary 
instrument hurriedly crafted by the Independence Preparatory Com- 
mittee in the last months before the Japanese surrender (see The Japa- 
nese Occupation, ch. 1). According to George McTurnan Kahin, 
whose 1952 book Nationalism and Revolution in Indonesia was the 
pioneering study of modern Indonesian politics, the constitution was 
considered "definitely provisional." Provisional or not, the constitu- 
tion provided structural continuity in a period of political discontinu- 
ity after 1998. Beginning with the preamble, which invokes the 
principles of the Pancasila, the 37 articles of the constitution set forth 
the boundaries of both Sukarno's Old Order and Suharto's New 
Order. Amendment of the 1945 constitution was one of the principal 
demands of the student movement that forced Suharto to resign in 
1998, and as of 2009 was one of the few of those demands that had 
been largely fulfilled. Four amendments eliminated many ambiguities 
and transformed the constitution into a more democratic framework, 
with extensive separation of powers and checks and balances. 

The Japanese efforts to establish an independent Indonesian state 
encouraged the writing of the 1945 constitution, which was very 
soon temporarily put aside and had not been fully implemented 
when the transfer of sovereignty from the Netherlands took place on 
December 27, 1949. The 1949 agreement called for the establish- 
ment of the Federal Republic of Indonesia (RIS). Subsequently, a 
provisional constitution adopted in February 1950 provided for the 
election of a constituent assembly to write a permanent constitution 
(see The National Revolution, 1945^9, ch. 1). A rising tide of more 
radical nationalism, driven partly by perceptions that the RIS was a 
Dutch scheme to divide and reconquer their former colony, rapidly 



231 



Indonesia: A Country Study 

moved political leaders in the direction of a unitary republic. The 
Committee for the Preparation of the Constitution of the Unitary 
State was established on May 19, 1950, and on August 14 a new 
constitution (technically an amendment to the RIS constitution) was 
ratified, to be in force until an elected constituent assembly com- 
pleted its work. The new, interim constitution provided for a parlia- 
mentary system of government, in which the cabinet and the prime 
minister were responsible to a unicameral legislature. The president 
was to be head of state but without real executive power except as a 
catalyst in forming a cabinet. 

As the political parties wrestled ineffectually in the parliamentary 
forum, dissident ethnic politicians and army officers joined in resist- 
ing central authority and even engaged in armed rebellions in various 
provinces between 1949 and 1962 (see The Road to Guided Democ- 
racy, 1950-65, ch. 1). Sukarno assumed an extra-constitutional posi- 
tion from which he wielded paramount authority in imposing his 
more defined concept of Guided Democracy in 1959. This move was 
backed by the senior military leaders whose revolutionary experi- 
ences had already made them suspicious, even contemptuous, of 
civilian politicians, and who were now dismayed by the disintegrative 
forces at work in the nation. The military moved to the political fore- 
front, where it remained until 1998. 

Sukarno sought to legitimize his authority by returning to the 1945 
constitution. He would have preferred to accomplish this goal consti- 
tutionally by having the 402-member Constituent Assembly formally 
adopt the 1945 constitution. However, the Constituent Assembly, 
elected in 1955 and divided along secular and religious lines, could 
not muster the required two-thirds majority necessary to approve new 
constitutional provisions. According to political scientist Daniel S. 
Lev, the body deadlocked on two fundamental issues: the role of Islam 
in the state and the question of federalism. Furthermore, division on 
these issues meant that ideological consensus among the anticommu- 
nist parties could not be translated into effective political cooperation. 
As long as the Constituent Assembly failed to agree on a new consti- 
tutional form, the interim constitution with its weak presidency con- 
tinued in force. Backed by the Indonesian National Armed Forces 
(TNI — see Glossary) and a large part of the public, which was impa- 
tient with the political impasse and the government's failure to imple- 
ment the promises of independence, on July 5, 1959, Sukarno decreed 
the dissolution of the Constituent Assembly and a return to the 1945 
constitution. Martial law had already been proclaimed on March 14, 
1957, and Sukarno claimed that under martial law his legal authority 
stemmed from his position as supreme commander of the TNI. 



232 



The national coat of arms of Indonesia depicts the Garuda — an ancient 
mythical bird — which symbolizes creative energy, the greatness of the 
nation, and nature. The 8 feathers on the tail, 17 on each wing, and 45 on 
the neck stand for the date of Indonesia s independence (August 1 7, 1945). 
The shield symbolizes self-defense and protection in struggle. The five 
symbols on the shield represent the state philosophy of Pancasila (see 
Glossary). The motto "Bhinneka Tunggal Ika" ("Unity in Diversity") on 
the banner signifies the unity of the Indonesian people despite their 
diverse ethnic and cultural backgrounds. 
Courtesy of Embassy of Indonesia, Washington, DC 

The original 1945 constitution proved to be extremely elastic as a 
provisional legal framework for a modern state, subject to broad 
interpretation depending upon the constellation of political forces in 
control at any given time. Other than outlining the major state struc- 
tures, the document contained few specifics about relations between 
citizens and the government and left open basic questions about 
rights and responsibilities of citizen and state. For example, Article 
28 states that "The freedom to associate and to assemble, to express 
written and oral opinions, etc., shall be established by law." Subse- 
quent laws, however, did not fully recognize the fundamental rights 
of the individual citizen stipulated by the constitution. These rights 
have now been enshrined and further delineated in a new chapter on 
human rights immediately following the original Article 28 — Arti- 
cles 28A to 28J, approved in 2000. However, the 1945 document also 
is an expression of revolutionary expectations about social and eco- 
nomic justice. The original Article 33 states that the economy shall 
be organized cooperatively, that important branches of production 



233 



Indonesia: A Country Study 

affecting the lives of most people shall be controlled by the state, and 
that the state shall control natural resources for exploitation for the 
general welfare of the people. An additional clause introduced in 
2002 now states that the national "economic democracy" shall be 
organized on the basis of such principles as togetherness, efficiency, 
justice, sustainability, environmental perspectives, self-sufficiency, 
and balance. 

The political struggle from 1945 to 1959 over the constitutional 
framework of the state stemmed not from the ambiguities of the 1945 
document nor its heavy weighting of executive power, but over deep 
disagreements about the nature of the state itself, particularly the 
issues of federalism and the role of Islam. Once the common battle 
against Dutch imperialism had been won, the passionate differences 
dividing various nationalist groups about the future of Indonesia sur- 
faced. The possibility of a federation of loosely knit regions was 
denied by the use of force, first in crushing the Republic of South 
Maluku (RMS) in 1950, then in suppressing the Darul Islam insurgen- 
cies in Jawa Barat, Aceh, and Sulawesi Selatan between 1949 and 
1962, and finally in defeating the Revolutionary Government of the 
Republic of Indonesia (PRRI) and the Universal Struggle Charter 
(Permesta) regional rebellions of 1957 to 1961. In subsequent decades, 
the central government was always sensitive to the issue of separat- 
ism, and the existence of a unitary republic, expressed through a pri- 
mary "Indonesian" national identity, seemed secure. The difficulty of 
integrating an Islamic political identity with the Indonesian Pancasila 
identity was no longer of primary importance by the late 1990s and, 
although hotly debated at times, was never a major stumbling block in 
the constitutional-amendment process from 1999 to 2002 (see Pan- 
casila: The State Ideology, this ch.). 

The Structure of Government 

The original 1945 constitution established a presidential system with 
significant parliamentary characteristics, whereas the amended consti- 
tution establishes a pure presidential system with extensive separation 
of powers and checks and balances. Sovereignty in Indonesia is vested 
in the people, who exercise their will through six organs of state of 
roughly equal stature. The president and vice president lead the execu- 
tive branch and are chosen as a team through direct, popular elections; 
the president is both head of state and head of government (see fig. 11). 
Legislative power is vested in the People's Representative Council 
(DPR) and the new but less powerful upper house, the Regional Repre- 
sentative Council (DPD). Although the People's Consultative Assem- 
bly (MPR) is now no more than a joint sitting of the DPR and DPD, it 



234 



Government and Politics 



retains separate powers that have been restricted to swearing in the 
president and vice president, amending the constitution, and having 
final say in the impeachment process. At the apex of the judicial sys- 
tem are the Supreme Court and the new Constitutional Court, whose 
powers include reviewing the constitutionality of laws, reaching a ver- 
dict on articles of impeachment, resolving disputes among state institu- 
tions, dissolving political parties, and resolving electoral disputes. 
Significant decentralization of power to subnational authorities has 
also been enshrined and delineated in the amended constitution. 

Legislative Bodies 

People's Representative Council 

Primary legislative authority is constitutionally vested in the Peo- 
ple's Representative Council (DPR; often referred to as the House of 
Representatives), which had 500 members in 1999, 550 members in 
2004, and 560 members in 2009. Members are elected for a five-year 
term from multimember districts under an open-list system of propor- 
tional representation. These electoral districts consist either of whole 
provinces (propinsi) or of several municipalities (kota) and regencies 
(kabupaten) within the same province (see Elections, this ch.). Parties 
must win at least 2.5 percent of the national vote in order to win DPR 
seats. Thirty-eight national parties contested the 2009 elections, and 
nine of those parties won seats in the DPR. Since 2004 the military 
and police no longer have appointed seats in any legislative body. 
Active members of these security forces were still disenfranchised in 
2009 but may be allowed to vote beginning in 2014. 

The DPR is led by a speaker and four deputy speakers elected by and 
from the membership, and each has a policy portfolio. Work is orga- 
nized through 11 permanent commissions (like U.S. congressional com- 
mittees), each with specific functional areas of governmental affairs 
corresponding to one or more ministries, and a budget committee. The 
DPR also has other bodies that specialize in interparliamentary coopera- 
tion, the legislative agenda, ethics violations, and internal financial and 
administrative management. The DPR secretariat includes a small 
research unit designed to provide nonpartisan information to members. 
Individual members have only one or two staff members, who primarily 
handle administrative tasks. Commissions also have a limited number of 
staff, mainly for administration. Party blocs have a handful of profes- 
sional staff supported by the DPR budget. The DPR's budget remains 
inadequate to support a professional legislature, and employees of the 
secretariat are still technically civil servants in the Department of Home 
Affairs. 



235 



Indonesia: A Country Study 



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236 



Government and Politics 



The legislative process in Indonesia has an extraordinary provision 
in Article 20(2) of the amended 1945 constitution, which requires 
bills to achieve the "joint approval" of the DPR and the president in 
order to become law. The unique twist is that approval by the presi- 
dent takes place as part of the legislative committee deliberations, not 
when the bill is sent to the president for signature. Bills may be initi- 
ated by either the executive or the DPR; most still originate in the 
executive branch. The president must issue a separate "presidential 
mandate" for each bill to the relevant cabinet minister to represent the 
executive branch in legislative deliberations. Issuance of this mandate 
is normally not a problem when the government initiates a bill but 
can be when the DPR is the initiating branch. Withholding this man- 
date in essence gives the president a veto that cannot be overridden 
by the DPR, which cannot deliberate on a bill without executive- 
branch participation. 

Legislative deliberations generally follow a four-step process. The 
first two of the four steps are a reading of the bill in a plenary session 
by a representative of the initiating branch, followed by a formal 
response from the other branch. In the third step, the bill is referred for 
further discussion and amendment to one of the permanent commis- 
sions, or often instead to a working committee (panitia kerja or panja) 
or special committee {panitia khusus or pansus) formed on an ad hoc 
basis for the purpose of addressing that bill. This step is the locus of 
the achievement of joint approval, and the executive branch partici- 
pates directly in these committee deliberations in the person of the rel- 
evant minister or department officials. This step is also the second 
source of the president's untrammeled veto power; if the president 
withholds approval of the bill, it cannot move forward. In the fourth 
step, when a bill has achieved joint approval in committee, it goes 
back to the plenary session for a final vote. The approved bill then 
goes to the president for signature; Article 20(5) of the constitution 
ensures that this is a formality, for any bill not signed by the president 
within 30 days of its approval by the DPR automatically becomes law. 
(The president cannot exercise a veto at this point, as there is not a 
third option of rejecting the bill and sending it back to the DPR.) 
Occasionally, circumstances compel the president to issue emergency 
regulations rather than wait for this lengthy legislative process to run 
its course. In this case, during the legislative session immediately fol- 
lowing the issuance of such regulations, the DPR must approve them; 
lacking such approval, they must be revoked. 

DPR deliberations are designed to produce consensus. It is the 
political preference of the leadership to avoid overt expressions of 
opposition or less than complete support. This practice is justified by a 
cultural predisposition to avoid, if possible, votes in which majority- 



237 



Indonesia: A Country Study 

minority opposing positions are recorded. If votes are necessary, how- 
ever, a quorum requires a two-thirds majority. On issues of nomina- 
tion and appointment, voting is by secret ballot; on all other matters, it 
is by a show of hands. 

The DPR also has an important role in various nonlegislative mat- 
ters under the amended constitution. The DPR begins the impeachment 
process by approving an indictment that is sent to the Constitutional 
Court for trial. The DPR must approve declarations of war and peace, 
treaties, and other international agreements initiated by the president. It 
also must approve the president's appointment and dismissal of the 
commander in chief of the armed forces, the national police chief, and 
members of the Judicial Commission. The DPR selects members of the 
Finance Audit Board (BPK) and three of the nine members of the Con- 
stitutional Court; it also approves the Judicial Commission's nomina- 
tions for Supreme Court justices. Finally, the president must consider 
the DPR's views regarding Indonesia's ambassadors to other countries, 
foreign ambassadors in Indonesia, and the granting of amnesties and 
pardons. In one of the few remaining vestiges of the parliamentary 
characteristics of the political system under the original 1945 constitu- 
tion, the DPR has the right of interpellation, the power to summon the 
president before the legislature to answer questions. In practice, how- 
ever, the DPR has found this power difficult to enforce. 

The legislature has become a more vibrant, vocal branch of gov- 
ernment with increasing pluralism and freedom and the expansion of 
the DPR's constitutional authority. Nonetheless, most legislation still 
originates in the executive branch. The DPR continues to lack suffi- 
cient professional research staff — whether attached to individual 
members, party blocs, commissions, or the legislature as a whole — 
and its constituency-outreach efforts remain limited as well. The leg- 
islative process itself remains slow, and the DPR suffers from a 
backlog of proposed bills waiting to enter the process. However, 
approximately 65 percent of the members elected in 2009 were new 
to the DPR, and even among those reelected there is a group inter- 
ested in reforming the institution, revising the standing orders to 
streamline the legislative process, and expanding the DPR budget to 
give it the resources to begin to study policy issues and draft legisla- 
tion on its own. 

Regional Representative Council 

The DPR's less-powerful partner in the legislative process is a 
body established in October 2004 to represent regional interests at the 
national level: the Regional Representative Council (DPD; some- 
times referred to colloquially as the Senate). This 132-member body 



238 



Main assembly building of Indonesia s legislature, with the legislative office 

complex to the right 

Part of Indonesia s legislative complex, including staff offices and meeting 

rooms for the MP R, DPR, and DP D 
Courtesy Yadi Jasin 



239 



Indonesia: A Country Study 

meets on the same calendar as the DPR, which is required by the con- 
stitution to hold sessions at least once every year. Four members from 
each province are elected directly by voters for the same five-year 
term as the DPR. To be eligible for nomination for the 2004 election, 
candidates could not be affiliated with political parties, must have 
collected 1,000 to 5,000 signatures from verified registered voters 
(depending on the size of the province), and must have resided in the 
province for five years. The DPR tried to strip the nonpartisan and 
residency requirements for the 2009 elections. However, the DPD 
petitioned the Constitutional* Court to overturn this decision as incon- 
sistent with the constitutional intent for the DPD; the court sided with 
the DPD and restored the provincial-residency requirement but ruled 
that it was constitutional to allow for partisan DPD candidates. Can- 
didates' photographs appear on the ballot paper, and voters are eligi- 
ble to vote for one candidate; the four candidates with the highest 
vote totals win. 

The DPD is led by a speaker and two deputy speakers; one of each 
of the three leaders represents western, central, and eastern Indonesia. 
The DPD has divided itself into four committees, each of which deals 
with a set of policy areas. Its role in the legislative process is more 
indirect than and subordinate to the DPR's. The DPD can propose 
bills to the DPR in the areas of regional autonomy; center-region 
relations; the formation, division, and merger of regions; the manage- 
ment of natural resources and other economic resources; and the 
financial balance between the center and the regions. The constitution 
also specifies that the DPD may participate in the deliberations 
regarding bills in these areas, but it does not indicate how this should 
happen, leaving that up to the two bodies to negotiate. The DPD must 
also provide its opinion to the DPR on the state budget and on bills 
regarding taxation, education, and religion. Finally, the DPD has 
oversight authority related to all of these policy areas; however, it 
cannot take action on the results of its inquiries, which go to the DPR 
for further action. 

One of the first acts of the DPD after its establishment was to 
begin work on a constitutional amendment to increase its powers. 
Passage of any amendments requires the support of a substantial por- 
tion of the DPR, and it is not likely that the DPR would support an 
amendment that would require it to share legislative power. In the 
2004 term, the proposal failed to garner sufficient support, but a 
commission has been established to study the issue, and it was likely 
the DPD would try again in the 2009 term. 



240 



Government and Politics 



People's Consultative Assembly 

No longer the highest constitutional body, the People's Consulta- 
tive Assembly (MPR) nonetheless retains important roles in the polit- 
ical process. The MPR inaugurates the president and vice president, 
has the final say in the impeachment process, and remains the only 
body permitted to amend the constitution. The "Broad Outlines of 
State Policy," a document that theoretically established policy guide- 
lines for the next five years and was subject to MPR approval during 
the Suharto years, has been abolished because competing presidential 
candidates are expected to present their policy platforms to the public 
during the campaign. The MPR now consists solely of the members 
of the DPR and DPD, having dropped the vague "functional group 
delegates" as part of the constitutional reform process. The MPR is 
led by a speaker (who also must be a DPR member) and four deputy 
speakers, two each from the DPR and the DPD. 

The Executive 

President and Vice President 

Indonesia's government is a strong presidential system with, since 
2004, significant checks and balances by the legislative and judicial 
branches as well as by local authorities. The president and vice pres- 
ident are directly elected as a ticket for a five-year term in a two- 
round system; if no ticket wins a simple majority in the first round, 
the two tickets that received the most votes advance to the second 
round. The winning presidential ticket must gain at least 20 percent 
of the vote in half of the provinces. A president is limited to two 
terms in office. The only qualifications for office provided in the 
constitution are that the president be a native-born Indonesian citi- 
zen, never have acquired another citizenship, never have committed 
treason, and be "spiritually and physically capable" of the office. 
Although the DPR is vested with primary legislative power, the pres- 
ident has de facto veto power over any legislation, with no possibil- 
ity of override by the DPR. The president serves as the supreme 
commander of the armed forces. The president appoints cabinet 
members, with no requirement for legislative confirmation. 

Between 1945 and 2009, Indonesia had six presidents: Sukarno 
(1945-67), Suharto (1967-98), Bacharuddin J. (B. J.) Habibie (1998- 
99), Abdurrahman Wahid (1999-2001; also known as Gus Dur), 
Megawati Sukarnoputri (2001^1; Sukarnoputri means "daughter of 
Sukarno"; it is not a family name), and Susilo Bambang Yudhoyono 
(since 2004; often referred to as SBY). When Suharto was forced to 
resign on May 21, 1998, Vice President Habibie became president 



241 



Indonesia: A Country Study 

and immediately announced a package of political reforms that 
included new legislative elections in June 1999. Although Mega- 
wati's Indonesian Democracy Party-Struggle (PDI-P) won a plural- 
ity in those elections, she was defeated in the MPR vote for president 
in October 1999 by Wahid when Habibie withdrew his candidacy fol- 
lowing a vote of no confidence. The MPR then elected Megawati as 
Wahid's vice president. Two years later, the MPR removed Wahid 
from office following allegations of corruption and incompetence, 
and Megawati became president. Yudhoyono and vice presidential 
candidate Muhammad Yustif Kalla defeated Megawati and three 
other tickets in Indonesia's first direct presidential elections in July 
and September 2004. Yudhoyono was reelected, this time running 
with Bank Indonesia governor Budiono, in one round in July 2009. 

Although the vice president is elected on a ticket with the president, 
the question of their relationship is a political issue. This is in part 
because the level of political pluralism forces parties and candidates 
to form coalitions: in 2004 Yudhoyono, from the Democrat Party 
(PD), chose Kalla to obtain support from the much larger, better orga- 
nized, and wealthier Golkar Party. This dynamic became even more 
pronounced two months after they were inaugurated, when Kalla was 
elected Golkar chairman at its party congress. During their adminis- 
tration, Kalla was wont on occasion to take a different stance than 
Yudhoyono on certain issues. Although privately Yudhoyono some- 
times admonished Kalla for this behavior, in public he insisted that 
they remained a solid team. Nonetheless, in early 2009 Yudhoyono 
began to distance himself from Kalla, signaling his intention to choose 
a different running mate. Following the April 2009 legislative elec- 
tions, Yudhoyono surprised many by bucking the logic of party coali- 
tions when he chose the technocratic, nonpartisan central banker 
Budiono as his vice presidential candidate; nonetheless, they were 
easily elected with 60.8 percent of the vote. Kalla was unsuccessful in 
forming a ticket with Megawati, and instead ran with retired General 
Wiranto, coming in a distant third place with 12 percent. Megawati 
and retired Lieutenant General Prabowo Subianto, Suharto's former 
son-in-law, placed second with 27 percent. 

The Cabinet 

The president appoints and is assisted by a cabinet of ministers. In 
October 2009, Yudhoyono named his second "United Indonesia" cab- 
inet, with 34 ministers representing six parties (the five that formed 
the nominating coalition for his presidential ticket plus Golkar). 
Twenty departments were headed by ministers, and these departments 
were grouped under three coordinating ministers: political, legal, and 



242 



Government and Politics 



security affairs; economic affairs; and people's welfare. The state sec- 
retary, who supports the president's role as head of state, also was a 
minister. There were 10 ministers of state, that is, ministers with port- 
folios but without full departments. Yudhoyono also revived the use 
of vice ministers, a practice allowed by law since 2008, appointing 1 1 
to ministries with particularly heavy workloads. Most of these vice 
ministers were career bureaucrats rather than partisan or retired mili- 
tary appointees. In addition to the ministers, two high-ranking state 
officials were accorded cabinet rank: the attorney general and the 
cabinet secretary. 

Specialized Agencies 

Specialized agencies and boards at the central government level are 
numerous and diverse. They include the National Development Plan- 
ning Board (Bappenas), the National Family Planning Coordinating 
Agency (BKKBN), the Capital Investment Coordinating Board 
(BKPM), and the Agency for the Study and Application of Technology 
(BPPT). At lower levels there are regional planning agencies, invest- 
ment boards, and development banks under the aegis of the central 
government. 

Presidential Advisory Council 

Article 16 of the amended constitution authorizes the president to 
establish an advisory council, and a law passed in 2006 further speci- 
fies this provision. Yudhoyono established the nine-member Presiden- 
tial Advisory Council in 2007, but in 2009 this body was still trying to 
determine what its role would be in relation to the cabinet and the 
advisers in the office of the president. The larger Supreme Advisory 
Council was abolished in 2002 by the Fourth Amendment. 

The Security Forces 

Article 30 of the constitution establishes the existence of the Indo- 
nesian National Armed Forces (TNI) and the National Police of 
Indonesia (Polri). The constitution further specifies that the role of 
the military is national defense, and the role of the police is public 
order and domestic security. However, the constitution does not 
explicitly establish the principle of civilian control of the security 
forces, leaving this matter to the laws on the military and police. 
Both of these institutions report directly to the president rather than 
through a cabinet minister, such as (for the military) the minister of 
defense or (for the police) the minister of home affairs or the minis- 
ter of justice and human rights (see The Armed Forces in National 
Life; The National Police, ch. 5). 



243 



Indonesia: A Country Study 
The Judiciary 

The Indonesian legal system is extraordinarily complex, the inde- 
pendent state having inherited three sources of law: customary or 
adat law, traditionally the basis for resolving interpersonal disputes in 
the village environment; Islamic law (sharia), often applied to dis- 
putes between Muslims; and Dutch colonial law. Adat courts were 
abolished in 1951, although customary means of dispute resolution 
are still in use in villages. The return to the 1945 constitution in 1959 
meant that Dutch laws remained in force except as subsequently 
altered or found to be inconsistent with the constitution. A criminal 
code enacted in 1981 expanded the legal rights of criminal defen- 
dants. The government in 2009 was still reviewing its legacy of 
Dutch civil and commercial laws in an effort to codify them in Indo- 
nesian terms. The types of law recognized in MPR Decree No. 3 of 
1999 include the constitution, MPR decrees, statutes passed by the 
DPR and ratified by the president, government regulations promul- 
gated by the president to implement a statute, presidential decisions 
to implement the constitution or government regulations, other imple- 
menting regulations such as ministerial regulations and instructions, 
and local (provincial and district) regulations. Obviously, the execu- 
tive enjoys enormous discretion in determining what is law. 

Article 24 of the amended constitution states that judicial power shall 
be vested in the Supreme Court, the Constitutional Court, and subordi- 
nate courts established by law, and that the organization and competence 
of courts shall be established by law. In Sukarno's Guided Democracy, 
the justice system became a tool of the revolution, and any pretense of 
an independent judiciary was abandoned. Although in theory one of the 
goals of the New Order was to restore the rule of law, in practice the 
judiciary remained both corrupt and a means for suppressing political 
dissent. Judicial reform was thus a key demand of the 1998 student 
movement and remains one of the most important items on the political- 
reform agenda. Important steps were taken in this regard as part of the 
1999-2002 constitutional-amendment process. A new body, the Consti- 
tutional Court, was established to review the constitutionality of laws, 
resolve disputes among the various branches and levels of government, 
have final say in the dissolution of political parties, and decide disputes 
over election results. The Constitutional Court also plays a role in the 
presidential-impeachment process by issuing a verdict on an indictment 
made by the DPR. The court has nine justices, three each nominated by 
the Supreme Court, the DPR, and the president. Justices must be knowl- 
edgeable about the constitution and may not be state officials. The Con- 
stitutional Court chief justice and deputy chief justices are chosen by 
and from among the justices. 



244 



Government and Politics 



The judicial branch stands coequal with the executive and legisla- 
tive branches. Justices of the Supreme Court are nominated by the 
independent Judicial Commission for approval by the DPR and for- 
mal appointment by the president. The chief justice and deputy chief 
justice are elected by and from among the justices. Members of the 
Judicial Commission must have a legal background or experience 
and are appointed and dismissed by the president with the approval 
of the DPR. The Supreme Court has exclusive jurisdiction in dis- 
putes between courts of the different court systems and between 
courts located in different regions. It can annul decisions of high 
(appellate) courts on points of law, not fact. On request, it can give 
advisory opinions to the government and guidance to lower courts. 
However, its powers of judicial review are limited to decisions on 
whether administrative regulations and local regulations conform to 
the laws as passed by the DPR. Another reform to strengthen the 
system of checks and balances was the 2004 shift of administrative 
and financial control over the lower courts from the Department of 
Justice (now called the Department of Justice and Human Rights) to 
the Supreme Court. 

Four different court systems operate below the Supreme Court. 
First, there are courts of general civil and criminal jurisdiction. Dis- 
trict courts are the courts of first instance. High courts (at the provin- 
cial level) are appellate courts. Following the Dutch legal system, 
cases are decided by panels of judges rather than juries. Sources of 
law on which parties to a dispute may base their claims include: 
international law (to date rarely used); modern Indonesian civil law, 
which has replaced but is often rooted in colonial-era Roman-Dutch 
civil law; and adat (customary) law, which differs widely among 
ethnic groups (see Tradition and Multiethnicity, ch. 2). The court 
system remains highly corrupt, with verdicts in both civil and crimi- 
nal cases influenced by bribery by both plaintiffs and defendants. 
Although judicial reform is key to consolidating democracy and 
establishing a more favorable investment climate, efforts at judicial 
reform have so far been half-hearted and largely ineffective. 

Second, religious courts exist throughout Indonesia to resolve dis- 
putes between Muslims in matters of marriage, divorce, inheritance, 
and gifts. These district-level courts base their decisions on Islamic 
law. As in the secular court system, religious high courts are appellate 
courts at the provincial level. One of the persistent tensions between 
Muslims and the state arises from efforts to expand the jurisdiction of 
the religious courts. 

Third, the state administrative court system resolves matters pertain- 
ing to the decisions of government officials. In addition, the Taxation 



245 



Indonesia: A Country Study 

Review Board adjudicates taxation disputes. Other administrative 
courts were eliminated as part of the government's effort to simplify 
and standardize the court system. 

Fourth, military courts have jurisdiction over TNI members. After 
the 1965 coup attempt, temporary special military courts were given 
authority to try military personnel and civilians alleged to be involved 
in the abortive coup (see The Coup and Its Aftermath, 1965-66, ch. 1). 
Hundreds of sentences ranging from 20 years' imprisonment to death 
were meted out by the special military courts, with executions occur- 
ring more than two decades after the event. The DPR has included a 
provision in a draft military law that would require all military person- 
nel accused of nonmilitary crimes to be investigated by civilian prose- 
cutors and tried by the civil court system. The military leadership 
opposed this provision, and it is still being debated. 

Another court, the Corruption Crimes Court (Tipikor Court), was 
established in 2003 to confront widespread corruption in Indonesia, 
especially in cases of financial loss to the state and as a deterrent to 
future corruption. In 2006, however, the Constitutional Court ruled 
that the Tipikor had no legal basis and gave the DPR and the govern- 
ment until December 2009 to pass a law to justify the court's contin- 
ued existence. Tipikor was allowed to continue to function during 
this period, and in September 2009 the DPR complied with appropri- 
ate enabling legislation, thus ensuring the court's constitutionality. 

Independent Bodies 

The Finance Audit Board is specified in Chapter VIILA of the con- 
stitution as an independent body existing at both the national and pro- 
vincial levels to conduct official examinations of the government's 
finances. The board reports to the DPR and DPD, which approve the 
national budget, and to each Regional People's Representative Coun- 
cil (DPRD), the legislative body that approves the budget at the pro- 
vincial, municipality, or regency level of government. The board's 
members are chosen by the DPR with nonbinding input by the DPD. 

The constitution established a number of independent bodies 
besides the Finance Audit Board and the Judicial Commission. In 
Article 22E(5), the constitution requires that elections shall be man- 
aged by an independent commission. The electoral law established the 
General Elections Commission (KPU), whose members are nomi- 
nated by the president and chosen by the DPR following a hearing and 
confirmation process called in Indonesia a "fit and proper test." One 
weakness of this system, as with the selection process for many other 
bodies in Indonesia, is that the president nominates multiple candi- 
dates for each position on the commission, from which the DPR is free 



246 



Government and Politics 



to select. Nominating multiple rather than single candidates makes the 
process much more vulnerable to favoritism and corruption, and in 
fact the DPR was widely criticized for choosing inexperienced over 
much more qualified candidates in its selections of KPU commission- 
ers in 2007. In Article 23D, the constitution also established a central 
bank, known as Bank Indonesia (see Monetary and Exchange-Rate 
Policy, ch. 3). The constitution only establishes the existence of the 
bank, leaving all of the details on its composition, status, authority, 
accountability and independence to the central bank law. 

Local Government 

Government administration operates through descending levels of 
administrative subunits. Indonesia is made up of 33 provinces and spe- 
cial regions (each led by a governor), up from 27 at the end of the New 
Order in 1998, as some provinces were subdivided, a process that may 
yet continue. There are two special regions (daerah istimewa; Aceh 
and Yogyakarta) and one special capital-city region (daerah khusus; 
Jakarta). The 30 provinces (propinsi), in turn, are subdivided into dis- 
tricts, called municipalities (kota, led by a mayor) in urban areas and 
regencies (kabupaten, led by a regent or bupati) in rural areas, and 
below that into subdistricts (kecamatan, led by a camat). At the lowest 
tier of the administrative hierarchy is the village (desa). According to 
the Department of Home Affairs, Indonesia in 2009 had 348 regen- 
cies, 91 municipalities, 5,263 subdistricts, and 66,979 villages. 

The New Order was a highly centralized system, but subnational 
governance has undergone significant change since 1999. In that 
year, the Habibie administration introduced two new laws collec- 
tively known as "regional autonomy policy," one on regional gover- 
nance and the other on the financial relationship between the center 
and the regions. This policy was further codified between 1999 and 
2002 in amendments to Chapter VI of the 1945 constitution. In 2004 
revised regional autonomy laws replaced the 1999 laws. This entire 
legal framework remains based on Indonesia as a unitary state. Since 
the Dutch-imposed RIS in 1949-50, federalism has been anathema to 
Indonesian politicians and the public. At the end of the 1945^19 war, 
as part of the negotiations over the terms of independence, the Dutch 
insisted that the nationalist Republic of Indonesia join with the vari- 
ous puppet states they had established around the archipelago to form 
the RIS. Nationalists saw this action as an attempt to maintain indi- 
rect Dutch control over Indonesia, and Sukarno ended the federal 
experiment only eight months later. One of the initial agreements in 
1999, at the outset of the constitutional amendment process, was to 
maintain Indonesia as a unitary state, as it has been since 1950. 



247 



Indonesia: A Country Study 

Indonesia, nonetheless, now enjoys a level of political decentraliza- 
tion greater even than some federal systems. Regional autonomy 
reserves six policy areas to the central government: foreign relations, 
national defense, internal security, justice, monetary policy, and religion. 
All other policy areas are primarily handled by provincial and district 
governments, with the central government's role limited to interregional 
coordination, setting service-delivery standards, and providing block 
grants. The 1999 laws bypassed the provincial governments and made 
district governments the primary locus of decentralized authority. This 
was because, at the time, the 6verriding concern was that the unfolding 
democratic transition might lead to the breakup of the nation, as had 
happened in Yugoslavia and the Soviet Union. The assumption was that 
districts would not have the size, resources, or distinctive ethnic identity 
sufficient to mount a separatist challenge to the center. This concern had 
receded significantly by the 2004 legal reforms, and provincial govern- 
ments regained some measure of authority. 

Service design, planning, and delivery are concentrated at the pro- 
vincial and district levels, although these subnational authorities do not 
have the power to raise much revenue on their own. Taxation remains 
primarily the prerogative of the central government, which then pro- 
vides block grants to local authorities. The size of these grants for each 
province or district is determined by a complex formula that takes into 
account the geographic size, population, and natural resource base of 
each unit. Although provinces and districts rich in natural resources 
cannot keep all of the revenues associated with those resources, they 
receive a much higher share than under the New Order. 

Another reform introduced in the revised regional autonomy laws 
of 2004 is that governors, mayors, and bupatis are now directly 
elected for the first time in Indonesia's history. Under the New Order, 
they had been appointed by the central government, and beginning in 
1999 they were elected by the local assembly. Since 2005, as the 
terms of these local chief executives expired, elections for their 
replacements for five-year terms have occurred on a rolling basis. 
Despite fears of administrative chaos, fraud, or violence, these local 
elections have generally proceeded smoothly, as was the case with the 
national elections of 1999, 2004, and 2009. 

Parallel to their chief executives, each province, municipality, and 
regency also has a local assembly, similar to the DPR, called the 
Regional People's Representative Council (DPRD). These councils 
range in size from 20 to 100 members, depending on the administra- 
tive level and the population of the region. They are elected at the same 
time as the DPR and for the same five-year term, which means that the 
terms of the regional assemblies and their corresponding regional chief 
executives are never the same. The DPRDs have powers similar to the 



248 





\ 

\ \ 



\ 



\ 



Political grafitti, "We are forced 
to cultivate on the moon, " 
Yogyakarta, 2002 
Courtesy Eric Stein 



DPR: approving the regional government budget, passing regional 
statutes, and providing oversight of the regional government. 

Five provincial-level units have special status, in addition to the 
devolution of power to all provinces under regional autonomy. Aceh 
and Papua (which was divided in two in 2005), the two remaining 
provincial-level units with active separatist movements once East 
Timor separated from Indonesia in 1999, were granted "special auton- 
omy." Jakarta and Yogyakarta have "special-region" status, although 
in practice they are not much different from other provinces. The 
main difference in Jakarta is that its five municipalities, while they 
have mayors, do not have corresponding assemblies (the only assem- 
bly is at the provincial level). In Yogyakarta the primary difference is 
that the sultan of the larger of the two palaces or kr atoms (in 2009, 
Sultan Hamengkubuwono X) automatically becomes governor. 

Indonesia's experience in East Timor (Timor Timur Province) — in 
the course of which President Habibie offered the province a referen- 
dum on special autonomy, Timorese voters defeated that referendum, 
and Indonesia was forced to acknowledge its independence — raised 
concerns for the government that this would set an example for other 
provinces. This fear has turned out to be largely unjustified, however, as 
no significant new separatist movements appeared in any provinces 
where they did not already exist prior to 1999. The main domestic 
impact of Timor-Leste's independence was to somewhat exacerbate 
existing separatist sentiments in Aceh and Papua. In Aceh in particular, 
a student-led group called the Aceh Referendum Information Center 
(SIRA) sprang up not long after Habibie's offer to East Timor and 
posted banners in the province calling for a referendum. Nonetheless, 
Aceh subsequently turned its focus to special autonomy and various 
peace negotiations (see Separatist Rebellions, ch. 5). In Papua the idea 



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Indonesia: A Country Study 

of a UN-administered referendum reminded many of the region's own 
decolonization process in the 1960s, the legitimacy of which is still 
questioned by many Papuans. As in Aceh, however, the focus in Papua 
then turned to a debate over special autonomy 

Aceh 

The Special Region of Aceh (called Nanggroe Aceh Darussalam, 
meaning the State of Aceh, Abode of Peace, from 1999 to 2009), in 
northwestern Sumatra, is the area of Indonesia where the Islamic 
character of the population is the most pronounced. The Acehnese 
demand for autonomy, expressed in support for the 1950s Darul 
Islam rebellion, was partially met by the central government's accep- 
tance of a "special-region" status for the province in 1959, allowing 
a higher-than-usual official Indonesian respect for Islamic law and 
custom. This special-region status, together with growing prosperity, 
brought Aceh into the Indonesian mainstream. Nevertheless, in the 
early twenty-first century the idea of an independent state was kept 
alive by the Free Aceh Movement (GAM). Thought to have been 
crushed in the mid-1970s, the guerrilla campaign of the insurgents, 
under the leadership of Swedish-based Hasan di Tiro and with Lib- 
yan support, renewed its hit-and-run warfare in the late 1980s, hop- 
ing to build on economic and social grievances. The military reacted 
with crushing force but never was able to defeat the separatists fully. 

President Habibie's offer in 1999 to revive the railroad from 
Medan in Sumatera Utara Province to Aceh's capital, Banda Aceh, 
and other economic-development projects in exchange for Acehnese 
loyalty to Jakarta was seen as a continuation of the patronizing, cen- 
tralistic politics of the New Order. Habibie's policy on East Timor 
led to growing calls among Acehnese civilians for a similar referen- 
dum. In response, the central government hurriedly passed a new 
law updating Aceh's "special-autonomy" status, including particu- 
larly the right to incorporate elements of Islamic law into local legal 
codes, which had not actually been a demand of most Acehnese. 
President Wahid involved international participants in resolution of 
the conflict for the first time by inviting the Geneva-based Henri 
Dunant Centre for Humanitarian Dialogue to help mediate a Cessa- 
tion of Hostilities Agreement (COHA). Although Vice President 
Megawati was not particularly supportive of this policy, she allowed 
the process to continue after she became president in July 200 1 , and 
the COHA was signed in December 2002. Nonetheless, by May 
2003 the agreement had broken down. President Megawati declared 
martial law in Aceh and unleashed the military once again. 



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Government and Politics 



The military had much more success than previously in breaking up 
GAM cells, but it still could not achieve final victory. Following her 
party's defeat in the legislative elections of April 2004, Megawati 
lifted martial law in May. In December 2004, a massive earthquake 
and tsunami struck Aceh, following which both the government under 
newly elected President Yudhoyono and the rebels returned to the 
negotiating table, this time with facilitation by former Finnish presi- 
dent Martti Ahtisaari through his nongovernmental organization Crisis 
Management Initiative. A memorandum of understanding detailing 
the peace agreement was signed in August 2005 and began to be 
implemented in September. A joint civilian effort between the Euro- 
pean Union (EU) and the Association of Southeast Asian Nations 
(ASEAN), called the Aceh Monitoring Mission, monitored the entire 
process. Ahtisaari was awarded the Nobel Peace Prize in 2008, in part 
for his efforts in Aceh. 

For its part, GAM relinquished the goal of independence, and its 
fighters were demobilized and their arms destroyed in public ceremo- 
nies between September and December 2005. The central government 
withdrew some military forces and paramilitary police units from the 
province. Funds were set up to provide cash or land (or both) to vari- 
ous categories of demobilized GAM ex-combatants and supporters, as 
well as (in a controversial move) pro-Indonesian militias, and training 
programs were established to provide job skills. A new law on gover- 
nance in Aceh replaced the special-autonomy law, and direct elections 
for governor, mayors, and bupatis occurred in December 2006. GAM 
formally dissolved itself in January 2006, but remnants may remain. 
A GAM-affiliated ticket running as independents, Irwandi Yusuf and 
Muhammad Nazar (the former leader of SIRA), were elected as gov- 
ernor and vice governor, respectively, and GAM-affiliated candidates 
also won in 11 of the 19 districts holding elections (in two of the 21 
districts the bupatis term had not yet expired). Acehnese were also 
allowed to form local political parties, unlike in the remainder of the 
country, to contest the 2009 special-region and district legislative 
elections. Although the Aceh-Nias Rehabilitation and Reconstruction 
Agency (BRR), set up in the wake of the tsunami, was dissolved in 
early 2009, the central government and international donors remain 
heavily invested in reinforcing the peace process and supporting 
reconstruction in Aceh. 

Papua 

Papua — formerly called at various times Irian Jaya, West Irian, West 
Papua, Dutch New Guinea, and West New Guinea — remained under 
Dutch control after Indonesian independence in 1949. A combination 



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Indonesia: A Country Study 

of Indonesian political and military pressure and international efforts 
led to an October 1962 Dutch transfer of sovereignty to the UN Tem- 
porary Executive Authority, which was supported by a military obser- 
vation force that oversaw the cease-fire. In May 1963, the UN gave 
Indonesia full administrative control. After a controversial 1969 "Act 
of Free Choice," the territory, which the Indonesians called Irian Barat 
(West Irian) until 1972, was integrated into the republic as Indonesia's 
twenty-sixth province and later renamed Irian Jaya (Victorious Irian). 
In 2000, in a vain attempt to dampen separatist sentiments, President 
Wahid renamed the province Papua. In a move widely perceived in 
Papua as an effort to divide and conquer, President Megawati in 2003 
set in motion a tortuous three-year process by which the northwestern 
portion was split off to form the new province of Irian Jaya Barat (West 
Irian Jaya), with the eastern two-thirds retaining the name Papua. (Irian 
Jaya Barat was renamed Papua Barat in 2007.) Further division of the 
rump Papua was blocked at the time, although various proposals for as 
many as four new provinces remain in circulation. Rich in natural 
resources, this is Indonesia's least densely populated region. The cen- 
tral government's efforts to exploit these resources and to assimilate 
indigenous Papuans, who are racially Melanesian, into the national 
administration and culture have met with sporadic armed resistance 
from the Free Papua Organization (OPM) and have aroused interna- 
tional concerns. 

Although the OPM is a marginal domestic actor, more visible as 
an international symbol, the fact of its existence has been used by the 
central government to justify suspicions about Papuan loyalties and 
an intimidating Indonesian military presence in the region, leading to 
human-rights abuses. Cultural differences between Indonesians and 
the indigenous population, and complaints about the "Indonesianiza- 
tion" of Papua, have exacerbated tensions. The cultural conflict is 
aggravated by resentment of racially Malay in-migrants (Javanese, 
Buginese, Bataks, and other groups) from other parts of Indonesia, 
who dominate the state bureaucracy and urban economies. Despite 
human-rights abuses and ethnic tensions, charges by some interna- 
tional activists that the central government is waging genocide in 
Papua are overblown. 

As in Aceh, the central government has responded to unrest in 
Papua with both repression and a new "special-autonomy" law. This 
law, passed in December 2002, provided for a much greater share of 
Papua's natural resource wealth to return to the region as block grants 
and specifies that these funds should prioritize the infrastructure, edu- 
cation, and health sectors. The law also provided for the establishment 
of a special upper house of the local legislature, the Papuan People's 



252 



Government and Politics 



Council (MRP). This body consists of representatives of religious 
leaders, traditional (adat) leaders, and women. The MRP is involved 
in all decisions regarding special autonomy, in any proposals to subdi- 
vide Papua, and in vetting candidates for governor, mayor, and bupati 
to ensure that they are native Papuans. Implementation of this law has 
been slow and partial. The enhanced fiscal resources began to flow to 
the region immediately, but without local-government capacity to use 
these funds properly, much has been wasted in corruption or inappro- 
priate projects. The MRP did not form until November 2005 and was 
immediately thrust into the uncomfortable position of having to rule 
on the formation of the new province of Irian Jaya Barat and guberna- 
torial candidates in both provinces. In February 2006, the first direct 
elections for governor proceeded in both Irian Jaya Barat and Papua, 
despite continued controversy regarding the sheer existence of the 
new province. At first the provincial government of Irian Jaya Barat 
did not receive special-autonomy funds (instead relying for its exis- 
tence solely on support provided by the central government), but in 
July 2008 the DPR passed a law mandating that special autonomy 
also be implemented fully in the renamed Papua Barat. 

Problems in Papua have implications for Indonesia's foreign rela- 
tions as well, particularly with neighboring Papua New Guinea and 
Australia. The border crossing with Papua New Guinea on the north 
coast near Jayapura reopened in late 2005, but relations with Austra- 
lia soured after it granted 42 Papuan boat people temporary protec- 
tion visas in March 2006. Despite resolution of the separatist conflicts 
in East Timor and Aceh, albeit via very different outcomes, it is likely 
that problems in Papua will continue to fester for many years, as the 
central government does not yet seem serious about addressing issues 
there in a systematic manner. 

Political Culture 

Following the constitutional amendments of 1999 to 2002, the 
reformed Indonesian political system is characterized by a set of 
institutions labeled a "difficult combination" in many other coun- 
tries: a powerful presidency and multiparty politics. There is a fixed 
term for the president as well as separate popular elections, and thus 
roughly equal democratic legitimacy, for the president and the 
national legislature. Some of the dangers inherent in this system are 
divided government, in which the presidency and the legislature are 
controlled by different political parties, and the possibility of elect- 
ing as president a political outsider who has no experience forging 
political compromises in the legislature. These dangers are exacer- 
bated in a multiparty polity, in which the likelihood of a single party 



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Indonesia: A Country Study 

controlling the legislature is much lower than in a two-party system. 
Under this difficult combination of institutions, deadlock can occur 
between the president and the legislature, leading one or both to be 
tempted to use extra-constitutional means to break the deadlock. 
When that occurs, democracy itself can be threatened. 

The strong presidential system tends to be associated with much 
more of a "winner-take-aH" political culture than has been evident in 
Indonesia since 1999. One of the hallmarks of the new Indonesian 
democracy is that although its institutions are strongly presidential, 
many of its practices are much more common in multiparty parlia- 
mentary government, including numerous possible inclusionary 
coalitions as well as consensus-based decision making. These inclu- 
sionary and consensual practices have contributed positively to mak- 
ing the blending of a strong presidency with multiparty politics 
function fairly well so far in Indonesia. This style of governance can 
be linked to other political cultures in Indonesia, particularly Java- 
nese and Islamic, as well as to the cultural roots of Pancasila. 

Inclusionary Coalitions 

The Indonesian political party system is as highly fragmented after 
the 2009 elections as it was in the 1950s. According to the Laakso- 
Taagepera Index (see Glossary), there are 6.1 "effective" political 
parties in the 2009 DPR versus 6.4 in the legislature following the 
1955 elections. Nonetheless, all of the major parties (and even most 
of the minor ones) cluster around the middle of the political spectrum. 
Thus, although the contemporary party system is equally fragmented, 
it is less polarized than in the 1950s. At that time, on the right end of 
the spectrum, both of the two major Muslim-based parties — Nahd- 
latul Ulama and the Consultative Council of Indonesian Muslims 
(Masyumi) — were Islamist, favoring the implementation of Islamic 
law. Now, of the four major Muslim-based parties, only two are Isla- 
mist, and only one of these as a matter of principle, the other out of 
political expediency. The other two parties take a much more moder- 
ate stance (see Muslim Parties, this ch.). On the left end of the spec- 
trum, in the 1950s the Indonesian Communist Party (PKI) was the 
most organized and grassroots-based of all the major parties, and was 
the largest communist party outside of the Soviet bloc and China. 
There is no radical leftist equivalent in the contemporary Indonesian 
party system. In 1999 the Democratic People's Party (PRD), which 
was the only party to include a hammer and sickle in its symbol, won 
barely 0.1 percent of the national vote, and its founder, Budiman 
Sujatmiko, joined the national leadership board of, and in 2009 was 
elected to, the DPR from Megawati's PDI-P. 



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Government and Politics 



The consequence of this clustering around the middle in the con- 
temporary party system is that parties mainly compete for political 
spoils rather than act on a programmatic basis. Coalition-building is 
thus a key element in determining political prosperity and even sur- 
vival. High fragmentation means that in order to build even a signif- 
icant bloc of votes (much less an outright majority), the coalition 
often must include several partners. Low polarization means that all 
three major and six smaller parties are potential coalition partners 
with each other. Both of these rules have proven to hold in Indone- 
sia. With decentralization and the inauguration of direct election of 
governors, mayors, and bupatis beginning in 2005, there are now 
hundreds of examples from around the nation of numerous, shifting 
coalitions being formed based on parties' local strength, even if 
these local coalitions often do not match the parties' political posi- 
tions at the national level. The two parties that are farthest apart on 
the political spectrum — the strongly secular PDI-P and the fervently 
Islamist Prosperous Justice Party (PKS) — have even formed local 
coalitions when it suited their needs. 

The coalition pattern at the national level has set the tone for these 
local alliances. The presidential election process in the MPR in 1999 
saw intense jockeying among most of the parties other than the PDI-P 
in a successful effort to deny front-runner Megawati the presidency. 
The newly elected president, Abdurrahman Wahid, then surprised 
some of these erstwhile supporters by reaching out to Megawati and 
supporting her nomination for vice president, which she accepted. 
Their first cabinet included ministers from all five major parties, and 
this pattern was maintained throughout subsequent reshuffles and 
Megawati's rise to the presidency in 2001. Prior to the 2004 legislative 
elections, most parties did not reveal their preferred presidential candi- 
date in order to maximize their coalitional possibilities in the first 
round of the direct presidential elections later in the year. That election 
included some strange bedfellows, such as former military commander 
General Wiranto, accused by many of human-rights abuses in the 1998 
transition and the 1999 East Timor referendum, gaining support from 
former President Wahid (a long-time human-rights activist) once the 
latter was disqualified from becoming a candidate himself. Wahid's 
brother Salahuddin Wahid even resigned from the National Human 
Rights Commission to be Wiranto 's running mate. The coalitions 
shifted again for the second round, with the parties behind the three 
losing tickets having to support either Megawati or Susilo Bambang 
Yudhoyono. The inclusionary pattern broke down briefly following 
Yudhoyono's election, when Golkar, the PDI-P, the National Awaken- 
ing Party (PKB), and the Reform Star Party (PBR) formed the National 



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Indonesia: A Country Study 

Front and took all DPR leadership positions for themselves. The 
exception proved the rule, however, as this maneuver was perceived as 
inappropriate, and within weeks the committee leaderships had been 
reshuffled to include all parties. In addition, Yudhoyono's first cabinet 
even included some figures affiliated with some of the National Front 
parties, creating links "across the aisle," even if these people tended to 
be marginal within their parties and were not officially representing 
their parties in the cabinet. Yudhoyono also worked assiduously to 
bring more and more of those parties over into his camp, leaving the 
PDI-P as the only steadfast opposition to his administration. 

This inclusionary political culture was less prominent during the 
2009 presidential elections but, after those elections, once again 
returned to the fore. Despite Golkar's position as the second-largest 
party after Yudhoyono's Democrat Party (PD), Yudhoyono decided to 
jettison Muhammad Yusuf Kalla as his running mate for reelection. 
Following the logic of the inclusionary political culture, all of Yud- 
hoyono's presidential coalition partners expected him to choose one 
of their leaders as his new running mate. Instead, Yudhoyono chose 
the nonpartisan, technocratic economist Budiono, who had served as 
his coordinating minister for economic policy before becoming gov- 
ernor of Bank Indonesia. Kalla and Megawati failed to form a coali- 
tion of the second- and third-largest parties, instead settling for 
coalitions with Wiranto of the People's Conscience Party (Hanura 
Party) and Prabowo Subianto of the Great Indonesia Movement Party 
(Gerindra Party), respectively. Nonetheless, after Yudhoyono won the 
presidential election with exactly the same large majority as in 2004 
(60.8 percent), he still turned to Kalla and Megawati to negotiate an 
inclusionary cabinet. Megawati rebuffed him, and so the cabinet 
formed in October 2009 did not include representatives from the 
PDI-P, the Hanura Party, or the Gerindra Party, but it did include rep- 
resentatives from Golkar as well as the five parties that nominated the 
Yudhoyono-Budiono ticket: the PD, PKS, National Mandate Party 
(PAN), Development Unity Party (PPP), and PKB. 

Consensus-Based Decision Making 

One of the ironies of Indonesian political culture is that while 
Suharto's New Order paid lip service to the achievement of consen- 
sus through deliberation as being an integral part of "Pancasila 
Democracy," in reality the system was then highly centralized, auto- 
cratic, and nonparticipatory, and instead it is the new democracy that 
has actually adopted consultative consensus. The preference for 
deliberation and consensus is partly driven by the exigencies of 
shifting inclusionary coalitions described above. However, even in 



256 



Government and Politics 



situations in which a strong majority coalition already exists, Indo- 
nesian political elites have preferred to continue to work to achieve 
consensus where practical. 

This cultural predilection was strongly evident in the MPR 
debates over constitutional reforms from 1999 to 2002 and is one of 
the main reasons those reforms took three years to achieve rather 
than one, as originally planned. In this case, the achievement of con- 
sensus also has an instrumental rationale: because the constitution is 
the source of the basic rules of politics, the wider the acceptance of 
those rules, the more likely they are to be followed in practice, con- 
tributing to democratic stability. Nevertheless, this predilection has 
also manifested itself even when an instrumental rationale is lacking, 
such as in the DPR. The DPR has continued the New Order practice 
of dividing all leadership positions — from speaker down to deputy 
committee chair — among all parties proportional to each party's 
share of seats, rather than just a majority coalition. There is no need 
to form an all-party coalition in support of the speaker or the presi- 
dent; rather, this practice is rooted in a desire to give every party a 
voice in the legislative process. Legislators have also seen voting by 
majority rule as a last resort, preferring to achieve consensus on leg- 
islation among all party blocs, even if this means extended delibera- 
tions and compromises. This practice has been one of the factors 
contributing to the DPR's very low legislative output. 

Traditional Political Culture 

Public tolerance of President Yudhoyono's careful, deliberative 
decision-making style and of the slow, consensus-based legislative 
process is partly due to the way these political practices reflect 
shared cultural values and expectations about leadership. In a nation 
as ethnically diverse as Indonesia — from Melanesian tribes in Papua 
to Chinese-Indonesian billionaires in Jakarta — and with its popula- 
tion differentially incorporated into the modern political economy, it 
is difficult to identify a political culture shared by all Indonesians 
(see Sources of Local Identification, ch. 2). Nevertheless, there are 
major cultural forces at work that do influence the political judg- 
ments of large groups of Indonesians. 

There are numerous traditional political cultures in Indonesia, but 
many aspects of modern Indonesian government and bureaucracy reflect 
Javanese cultural undeipinnings. Even though Indonesia is a cultural 
mosaic, the Javanese, with about 41 percent of the total population, are by 
far the largest single ethnic group. Moreover, they fill — to a degree some- 
what greater than their population ratio — the most important roles in gov- 
ernment and the military. Javanese cultural predispositions therefore 



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Indonesia: A Country Study 

influence the way the government appeals to and interacts with the popu- 
lation. Although the Javanese kingship model was particularly appropri- 
ate for understanding Suharto and the authoritarian New Order, it 
continues to have relevance in democratic Indonesia (see Javanese, ch. 2). 

Political power on Java historically was deployed through a patri- 
monial bureaucratic state in which proximity to the ruler was the key 
to command and rewards. This power can be described in terms of a 
patron-client relationship in which the patron is the bapak (father or 
elder). The terms of deference and obedience to the ruler are con- 
ceived in the Javanese gusti-kawula (lord-subject) formulation, 
which describes man's relationship to God as well as the subject's 
relationship to his ruler. The reciprocal trait for obedience is benevo- 
lence. In other words, benefits flow from the center to the obedient. 
By extension, government's developmental activities are a boon to 
the loyal. Bureaucratically, Javanese culture is suffused with an atti- 
tude of obedience — respect for those more senior, conformity to 
hierarchical authority, and avoidance of confrontation — characteris- 
tics of the preindependence priyayi (see Glossary) class whose roots 
go back to the traditional Javanese courts. 

Javanism (kejawen) also has a mystical, magical dimension in its 
religiously syncretic belief system, which integrates pre-Indian, Indian, 
and Islamic beliefs. Its practices include animistic beliefs, which invest 
sacred heirlooms (pusaka) with animating spirits, and rites of passage 
whose antecedents are pre-Islamic. Javanism also encompasses the 
introspective ascetic practices of kebatinan (see Glossary), mysticism 
as related to one's inner self, that seek to connect the microcosms of 
the self to the macrocosms of the universe (see Islam, ch. 2). The poli- 
tics of Javanism have been defensive, seeking to preserve its particular 
heterogeneous practices from demands for Islamic orthodoxy. 

Islamic Political Culture 

According to the 2000 census, 86.1 percent of the population (in 
2009 an estimated 240.3 million people) identified themselves as 
Muslim, making Indonesia the largest Muslim nation in the world, 
united with the universal Islamic community (ummah) in the profes- 
sion and practice of the faith (see Religion and Worldview, ch. 2). 
The appeal of Islam did not weaken when modern secular national- 
ism became the predominant basis for the independent Indonesian 
state. In fact, given the prominence of Islamic proselytization and 
reinvigoration, the people's desire to maintain Islamic institutions 
and moral values arguably is at an all-time high in Indonesia. There 
is, however, a distinction between Islam as a cultural value system 
and Islam as a political movement. 



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Government and Politics 



Islam in Indonesia is not monolithic. Indonesia's nominal or sta- 
tistical Muslims, referred to as abangan (see Glossary), are mostly, 
with varying degrees of self-awareness, believers in kebatinan. It is 
notoriously difficult to parse out the percentage of Indonesian Mus- 
lims who are abangan and those who are santri (see Glossary), the 
term for orthodox believers. What is clear is that the latter have been 
gaining ground since the 1970s and are probably now a majority of 
the population as a whole. The vote totals of Muslim and Islamist 
political parties, about 37 percent in both 1999 and 2004 and about 
26 percent in 2009, are not a very good measurement of the appeal 
of orthodox Islam, as many santri are personally pious but believe 
that religion should be kept out of politics and thus support secular 
nationalist parties (see Muslim Parties, this ch.). Furthermore, the 
orthodox are themselves divided into traditionalists and modernists, 
and each of these streams then subdivides into extremist, conserva- 
tive, moderate, and liberal camps (see Political Dynamics, this ch.). 

The principal organization reflecting the traditionalist outlook is 
Nahdlatul Ulama (literally, "revival of the religious teachers"), 
founded in 1926. Nahdlatul Ulama has its roots in the traditional rural 
Islamic schools (pesantren) of central and eastern Java. Claiming 
more than 40 million members, Nahdlatul Ulama is the largest Mus- 
lim organization in the world. Modernist, or reformist, Islam in Indo- 
nesia is best exemplified by the Muhammadiyah (Followers of 
Muhammad), which claims 30 million members. The latter organiza- 
tion was founded in 1912, when the spirit of the Islamic reform move- 
ment born in Egypt in the late nineteenth century reached Southeast 
Asia. In addition to their reform agenda, modernists sought to purify 
(critics argue Arabize) Indonesian Islam. 

Both santri streams found formal political expression in the 
postindependence multiparty system. Masyumi was the main political 
vehicle for the modernists. However, its apparent support for the 
PRRI-Permesta regional rebellions between 1957 and 1961 led to 
constraints on its activities, and the party was banned in 1959. Nahd- 
latul Ulama directly competed as a party in the politics of the 1950s 
and, seeking to capitalize on Masyumi's banning, collaborated with 
Sukarno in the hope of winning patronage and followers. Nahdlatul 
Ulama also hoped to stop the seemingly inexorable advance of the 
secular left under the leadership of the PKI. Islamic political parties 
were prohibited from advancing an explicitly Islamist message in the 
New Order, but traditional systems of communication within the 
community of believers, including instruction in Islamic schools and 
mosque sermons, passed judgments on politics and politicians — the 
so-called "hard" dakwah (vigorous promotion of Islam). 



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Indonesia: A Country Study 

The followers of the hard dakwah form a minority, albeit a vocal 
one. Some Islamists might be disaffected with the state; however, the 
goal of urban, middle-class Muslims, who share in the benefits of 
government economic policies and are relatively untouched by the 
preaching of rural Muslim teachers, is not to overthrow democracy. 
They want to transform the government from within to make its acts 
conform more with Islamic values, a focus not on the state itself but 
on reforming policies and practices that are offensive. The issues 
that energize middle-class Muslims include not just the persistent 
Muslim complaints about secularization, Christianization, and moral 
decline, but also contemporary political grievances about the inequi- 
table distribution of income, corruption, and concentration of wealth 
and power in the hands of Chinese Indonesians to the detriment of 
indigenous (pribumi — see Glossary) entrepreneurship. These kinds 
of issues cut across religious boundaries and unite moderate middle- 
class Muslims with more secular members of the middle class. 

Pancasila: The State Ideology 

The government undertook at independence the major effort of 
subsuming all of Indonesia's political cultures, with their different 
and often incompatible criteria for legitimacy, into a national political 
culture based on the values set forth in the Pancasila. The preamble of 
the 1945 constitution establishes the Pancasila as the embodiment of 
basic principles of an independent Indonesian state. These five princi- 
ples were announced by Sukarno in a speech on June I, 1945. In 
brief, and in the order given in the constitution, the Pancasila princi- 
ples are belief in one supreme God, humanitarianism, nationalism 
expressed in the unity of Indonesia, representative democracy, and 
social justice. Sukarno's statement of the Pancasila, while simple in 
form, resulted from a complex and sophisticated appreciation of the 
ideological needs of the new nation. In contrast to Muslim national- 
ists who insisted on an Islamic identity for the new state, the framers 
of the Pancasila insisted on a culturally neutral identity, compatible 
with democratic or Marxist ideologies, and overarching the vast cul- 
tural differences of the heterogeneous population. Like the national 
language, Bahasa Indonesia, which Sukarno also promoted, the Pan- 
casila did not come from any particular ethnic group and was 
intended to define the basic values for a national political culture. 

The Pancasila has its modern aspects, although Sukarno presented 
it in terms of a traditional Indonesian society in which the nation par- 
allels an idealized village: society is egalitarian, the economy is orga- 
nized on the basis of mutual cooperation (gotong royong), and 
decision making is by deliberation (musyawarah) leading to consen- 



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Government and Politics 



sus {mufakat). In Sukarno's version of the Pancasila — further defined 
by Suharto — political and social dissidence constituted deviant 
behavior. 

One reason why both Sukarno and Suharto were successful in 
using the Pancasila to support their authority, despite their very dif- 
ferent policy orientations, is the generalized nature of the principles 
of the Pancasila. The Pancasila has been less successful as a unifying 
concept when leadership has tried to give it policy content. Suharto 
greatly expanded a national indoctrination program established by 
Sukarno to inculcate a regime-justifying interpretation of the Pan- 
casila in all citizens, especially schoolchildren and civil servants. 
The Pancasila was thus transformed from an abstract statement of 
national goals into an instrument of social and political control. To 
oppose the government was to oppose the Pancasila. To oppose the 
Pancasila was to oppose the foundation of the state. The effort to 
enforce conformity to the government's interpretation of Pancasila 
ideological correctness was not without controversy. The issue that 
persistently tested the limits of the government's tolerance of alter- 
native or even competitive systems of political thought was the posi- 
tion of religion, especially Islam. 

Islam and the Indonesian state had a tense political relationship 
from the very outset of independence. The Pancasila 's promotion of 
monotheism is a religiously neutral and tolerant statement that equates 
Islam with the other religious systems: Christianity, Buddhism, and 
Hindu-Balinese beliefs. However, Muslim political forces had felt 
betrayed since signing the June 1945 Jakarta Charter, under which 
they accepted a pluralist republic in return for agreement that the state 
would be based upon belief in one God "with Muslims obligated to 
follow the sharia." The decision two months later to remove this 
seven- word phrase from the preamble of the 1945 constitution, to 
keep predominantly Christian areas of eastern Indonesia from break- 
ing away from the nationalist movement and declaring their own inde- 
pendence, set the agenda for future Islamic politics. At the extreme 
were the Darul Islam rebellions of the 1950s, which sought to estab- 
lish a Muslim theocracy. 

Orthodox Muslim groups saw the New Order's emphasis on the 
Pancasila as an effort to subordinate Islam to a secular state ideol- 
ogy, even a "civil religion" manipulated by a regime inherently 
biased against the full expression of Muslim life. By the 1980s, how- 
ever, within the legal and politically acceptable boundaries of Mus- 
lim involvement, the state had become a major promoter of Islamic 
institutions. The government even subsidized numerous Muslim 
community activities. Within the overall value structure of the Pan- 



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Indonesia: A Country Study 

casila, Islamic moral teaching and personal codes of conduct bal- 
anced the materialism inherent in secular economic development. By 
wooing Islamic leaders and teachers, the state won broad support for 
its developmental policies. There is no question but that Islam was a 
state-favored religion in Indonesia, but it was not a state religion. 
That reality defined the most critical political issue for many ortho- 
dox Muslims. The so-called "hard" dakwah, departing from sermons 
and texts tightly confined to matters of faith and Islamic law, was 
uncompromisingly antigovernment. The Islamists called for people 
to die as martyrs in a "struggle until Islam rules." This call, for the 
government, was incitement to "extremism of the right," subversion, 
and terrorism. The government reaction to radical Islamic provoca- 
tions was unyielding: arrest and jail. 

The democratic transition has entirely dismantled the New Order 
structures that institutionalized politicization of the Pancasila. Although 
the Pancasila is still taught in schools, the national indoctrination pro- 
gram for adults and the agency charged with managing it have both 
been abolished. Most importantly, political parties and social organiza- 
tions are no longer required to adopt the Pancasila as their underlying 
ideological principle (asas tunggal). Prominent Muslim organizations 
in particular immediately took advantage of this change. For instance, 
the Development Unity Party (PPP) reestablished Islam as its ideologi- 
cal basis and returned to its pre- 1984 party symbol, the Kaaba in 
Mecca. Secular nationalist parties and organizations, however, have 
retained the Pancasila as their ideological basis. In the early twenty-first 
century, the Pancasila thus remains alive in Indonesian political dis- 
course in two ways. Harkening back to the pattern in the 1940s and 
early 1950s, it is one among several ideological strands underpinning 
political conflicts that have many other dimensions as well: economic, 
social, regional, and ethnic. On occasion, however, it is still used as a 
unifying force that can tie all Indonesians together within a national 
political culture. For example, President Yudhoyono has made several 
major speeches extolling the Pancasila's virtues in this regard. While 
generally still aimed at countering the influence of Islamist discourse, 
this latter usage elevates the Pancasila above the fray of mundane polit- 
ical squabbles. 

The Political Process 

Many political parties representing all parts of the Indonesian socio- 
cultural spectrum contest national and local elections. Smaller parties 
disappear, and larger parties split and recombine, no longer because of 
government interference, but rather, simply, because of the harsh sink- 
or-swim logic of the free political marketplace: election results and the 



262 



Government and Politics 



internal dynamics of these parties. In other words, although Indonesian 
democracy is not yet fully consolidated and faces many challenges, it 
is well on its way to becoming "the only game in town." 

The Multiparty System: Significant Pluralism 

Indonesian voters have clearly rejected the controlled party politics 
of Guided Democracy and the New Order. Since 1998 hundreds of 
parties have been founded; 48 qualified to take part in the 1999 elec- 
tions, 24 for the 2004 elections, and 38 for the 2009 elections (the lat- 
ter not including the six local parties that contested only in Aceh). Of 
the 38 national parties, nine won seats in the 2009 DPR. The level of 
political pluralism (as measured by the Laakso-Taagepera Index of 
effective political parties) increased from 4.7 in 1999 to 7.1 in 2004 
(compared to 6.4 in 1955). Efforts to engineer the electoral framework 
in order to consolidate the party system, by reducing district magni- 
tude and instituting an electoral threshold of 2.5 percent, were success- 
ful: the level of pluralism in 2009 dropped to 6.1 effective political 
parties. This remains, however, a comparatively high level of plural- 
ism for a presidential system. Party registration criteria in essence pro- 
hibit regional parties and force parties to be national in scope. The first 
and so far only exception to this rule was made as a concession to 
GAM in the Aceh peace negotiations. Ex-GAM supporters used this 
exception to form numerous parties, and six qualified to contest the 
2009 provincial and district legislative elections. 

The largest political parties are secular nationalist parties, which 
espouse Pancasila as their ideological foundation and have developed 
platforms that appeal to all Indonesians regardless of religion. Given 
an overwhelming Muslim-majority population, most of these parties' 
supporters are Muslim by faith, but they do not believe in mixing faith 
and politics. These parties include the Golkar Party (the New Order 
ruling party), the Indonesian Democracy Party-Struggle (PDI-P), and 
the Democrat Party (PD). Muslim parties draw their support primarily 
through informal linkages with mass-based Muslim social organiza- 
tions such as Nahdlatul Ulama and Muhammadiyah, but they are sec- 
ular nationalist in ideology and platform. These parties include the 
National Awakening Party (PKB), associated with Nahdlatul Ulama, 
and the National Mandate Party (PAN), associated with Muhammadi- 
yah. Islamist parties are those that proclaim Islam as their ideological 
foundation and base their platforms on Islam, including support for 
Islamic law. This category includes the Development Unity Party 
(PPP) and the Prosperous Justice Party (PKS). 

Although links can be made between these contemporary parties 
and their predecessors from the 1950s, two differences stand out. 



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Indonesia: A Country Study 

First, the Muslim/Islamist end of the spectrum is much more divided 
and moderate. Second, there is no direct heir to the Indonesian Com- 
munist Party (PKI), and in fact parties professing Marxism-Leninism 
continued to be outlawed until the Constitutional Court declared this 
ban unconstitutional in 2005. Despite this decision, it is not likely 
the PKI will be revived any time soon because of the strong emo- 
tions it engenders among many Indonesians and because its former 
constituency has found a home within several parties, particularly 
Golkar, the PDI-P, the PD, and the PKB. Most of the major parties 
draw their strength from association with one or another of Indone- 
sia's socioreligious streams of belief (aliran kepercayaari) and a 
popular individual leader. The parties tend to be highly centralized 
and riven with internal factionalism. It is very common for factions 
that lose out in internal party leadership elections to leave to form a 
rival party. However, few of these splinter parties have fared well in 
national elections. 

Secular Nationalist Parties 

Golkar Party 

The Golkar Party is the revamped, democratic version of the New 
Order authoritarian ruling party Golongan Karya (Golkar), the military- 
backed organization of "functional groups." The longer original name 
has been dropped, and now the party is simply known as Golkar. Its tra- 
ditionally very close ties to the military and civil service no longer 
exist, although many officers and bureaucrats have chosen to continue 
to support the party rather than join another. However, this support is 
now personal and private, as the election laws prohibit the use of state 
resources to support any party, and individual military officers and gov- 
ernment officials must resign their positions in order to stand as politi- 
cal candidates. Despite these new restrictions on Golkar's ability to tap 
its traditional constituencies, the party enjoys advantages over its rivals 
as a result of its national network, which extends to every village; its 
experienced politicians; and its strong fund-raising capabilities. The 
party no longer commands the electoral majorities of 60 to 70 percent 
that it engineered under the New Order, but it still makes a strong 
showing, winning 22.4 percent of the vote (120 of 500 DPR seats) to 
come in second to the PDI-P in the 1999 legislative elections, the larg- 
est share of the votes in 2004 (21 .6 percent, 128 of 550 DPR seats), and 
in 2009 the second-largest share (14.5 percent of the vote, 106 of 560 
DPR seats). Golkar has also won some of the direct elections for gover- 
nor, mayor, and bupati, and the party's chair, Muhammad Yusuf Kalla, 
held the vice presidency from 2004 to 2009. 



264 




A Yogyakarta storefront display, in June 2000, of portraits of Abdurrahman 
Wahid (Indonesia's third president, 1999-2001), Sukarno (Indonesia's first 
president, 1945-66), and Megawati Sukarnoputri (Wahid's vice president, 
1999-2001, Indonesia's fourth president, 2001-4, and daughter of Sukarno) 
Courtesy Florence Lamoureux, © Center for Southeast Asian Studies, 

University of Hawai 'i 

Golkar had its roots in Sukarno's Guided Democracy as an army- 
sponsored coalition of nearly 100 anticommunist organizations and 
Sukarno's Indonesian Nationalist Party (PNI) to balance the weight of 
the PKI. After 1966 it was reorganized by Suharto as an ostensibly 
nonpartisan civilian constituency for the New Order's authority. Its 
core membership was the military, police, civil service, and employ- 
ees of state-owned enterprises. Over the course of the New Order, the 
balance of power in the party slowly shifted to civilians, particularly 
those such as future party chairman Akbar Tanjung who cut their 
organizational teeth in the Islamic University Student Association 
(HMI) and later the Indonesian Muslim Intellectuals' Association 
(ICMI). As chair from 1983 to 1988, Sudharmono, who served as vice 
president of Indonesia from 1988 to 1993, attempted to make Golkar 
a more effective political instrument by shifting from a "functional 
group" basis to individual cadre membership. As a mass-mobilizing, 
cadre party loyal to Suharto, Golkar emerged as an autonomous polit- 
ical force in society, no longer fully responsive to the military. 

Following Suharto's resignation in May 1998, at a special party 
congress in July, Golkar took its first major step toward transforming 



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Indonesia: A Country Study 

itself into a more dynamic and viable democratic party by choosing 
Akbar Tanjung over Lieutenant General (retired) Edi Sudrajat as its 
new chair. Akbar retained control over the party, installing many of 
his HMI/ICMI faction colleagues in leadership positions and steer- 
ing the party successfully through the political minefields of the 
1999 and 2004 elections, until losing the chairmanship to newly 
elected Vice President Kalla at the party congress in December 2004. 
With Kalla's political fortunes declining in 2009, Golkar's election 
of outgoing Coordinating Minister for People's Welfare Aburizal 
Bakrie as its new chairman in October 2009, just weeks before the 
announcement of the new cabinet, was an attempt by the party to 
retain some national political power. Golkar is generally stronger 
outside Java and Bali, as reflected by two of its most recent chairs: 
Akbar is from Sumatera Utara, and Kalla is from Sulawesi Selatan. 
Kalla and Bakrie also represent an important constituency within 
Golkar: wealthy pribumi (see Glossary) private businesspeople 
whose family fortunes are largely a product of Sukarno's protection- 
ist economic policies and Suharto's patronage politics. 

Indonesian Democracy Party-Struggle 

The PDI-P is the successor party to one of the two other parties 
besides Golkar allowed to exist by the New Order: the Indonesian 
Democracy Party (PDI). The PDI emerged in 1973 from a fusion of 
two Christian parties: the Indonesian Christian Party (Parkindo) and 
the Catholic Party (Partai Katolik); and three secular parties: the 
Indonesian Nationalist Party (PNI), the League of the Supporters of 
Indonesian Independence (IPKI), and the Party of the Masses (Partai 
Murba). With no common ideological link among these constituent 
parties other than a commitment to Pancasila, the PDI was highly fac- 
tionalized, torn by personality disputes, and held together only by 
direct government intervention into its internal affairs. For example, 
the IPKI had been strongly anti-PKI in the Old Order in contrast to 
the once-leftist Partai Murba. The PNI, strongest in Jawa Timur and 
Jawa Tengah, was the largest of the five parties and the legatee of the 
late President Sukarno. With Sukarno's gradual public rehabilitation 
as an "Independence Proclamation Hero" and the father of Pancasila, 
the PDI was not reluctant to trade upon the Sukarnoist heritage of the 
PNI, including recruiting several of Sukarno's children as candidates 
and campaigners. Most prominent among them was his eldest daugh- 
ter, Megawati Sukarnoputri, whose presence helped expand the PDI's 
vote total in the 1992 elections. After she was elected party chair in 
1993, Suharto began to see her as a greater threat and tried to have her 
removed, but she stood her ground. In 1996 the government backed a 



266 



Government and Politics 



rival faction to forcibly eject Megawati and her supporters from party 
offices. She responded by founding the PDI-P to distinguish it from 
the New Order-backed PDI, which garnered only 3 percent of the 
vote in the 1997 elections. Because the PDI-P was not allowed to run 
in those elections, Megawati instructed her supporters to punish the 
rump PDI by voting for the PPP, which grew enormously as a result. 

Both the PDI-P and the rump PDI competed in the 1999 elections, 
but with vastly different results. The PDI-P won the largest share 
with 33.7 percent (153 DPR seats), while the PDI languished with 
only 0.6 percent (two seats). Megawati became the frontrunner for 
the October 1999 presidential selection process in the MPR but lost to 
Abdurrahman Wahid, who then helped her get selected as vice presi- 
dent. When Wahid was removed from office in 2001, she became 
president until 2004, when she was defeated in direct elections by 
Susilo Bambang Yudhoyono. The PDI-P 's vote in the 2004 legisla- 
tive elections suffered as well, losing almost half of its support to fall 
to 18.5 percent (109 DPR seats), as a result of public disappointment 
with her performance as president, her husband Taufik Kiemas's rep- 
utation for corruption, and the party as a whole. Despite these set- 
backs, Megawati was reelected party chair at the 2005 congress, 
prompting some disaffected leaders led by Laksamana Sukardi to bolt 
and found the Democracy Renewal Party (PDP). In the 2009 legisla- 
tive elections, the PDI-P 's support dropped further to 14 percent (94 
DPR seats) as a result of competition from the Democrat, Gerindra, 
and Hanura parties. Megawati, this time running with Prabowo Subi- 
anto, was defeated in a rematch with Yudhoyono in the 2009 presi- 
dential election. 

Democrat Party 

The Democrat Party (PD) was founded by then-Coordinating Minis- 
ter of Politics and Security Susilo Bambang Yudhoyono in 2001 to be 
his political vehicle. He broke with the usual pattern in Indonesia, how- 
ever, and did not become the party's chairman. The bulk of the party's 
initial cadres were mostly mid-level ex-Golkar and former military 
leaders. Although the party's local branch structure remained weak at 
the time of the April 2004 legislative elections, the PD still managed to 
capture 7.5 percent of the vote (57 DPR seats), and thus become one of 
the seven largest parties, largely on the strength of Yudhoyono 's per- 
sonal popularity. Between 2004 and 2009, the success of the party and 
Yudhoyono 's presidential bid attracted new cadres, who expanded the 
party's structure into a truly national presence. This expansion, com- 
bined with Yudhoyono 's continuing popularity, gave the PD the most 
votes in the April 2009 legislative elections, with 20.9 percent of the 



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Indonesia: A Country Study 

vote (148 of 560 DPR seats). The party's prospects in 2014 and beyond 
remain unclear, however, with Yudhoyono no longer eligible to run for 
reelection at that time. 

Gerindra and Hanura Parties 

The two smallest of the nine parties to win DPR seats in the 2009 
elections were new parties both founded by retired army generals 
with highly tainted human-rights records. The Great Indonesia Move- 
ment Party (Gerindra Party) is the political vehicle for retired Lieu- 
tenant General Prabowo Subianto, the son of famed economist and 
finance minister Sumitro Joyohadikusumo and the former son-in-law 
of Suharto. Prabowo has a particularly cruel reputation from his 
career in the Army Special Forces Command (Kopassus) and has 
been implicated in severe human-rights abuses in East Timor, the 
temporary or permanent disappearance and death of 23 prodemoc- 
racy activists in 1997 and 1998, and the Jakarta riots, as well as a 
coup attempt against newly installed President Habibie, in May 1998. 
Despite this record, Prabowo was able to convince three of the activ- 
ists he is alleged to have kidnapped and tortured to run under the Ger- 
indra Party banner, and the party won 4.5 percent of the vote and 26 
DPR seats. Prabowo ran as Megawati's vice presidential candidate, 
but they placed a distant second to Yudhoyono. 

The People's Conscience Party (Hanura Party) was founded by 
retired General Wiranto, who helped force Suharto from power, 
quash Prabowo 's attempted coup, and begin military reforms. He 
also was in command during the Indonesian army-backed militia 
rampage in East Timor in September 1999 as well as during several 
bloody incidents with demonstrators in Jakarta. In 2009 the Hanura 
Party won 3.8 percent of the vote and 17 DPR seats. Wiranto ran as 
Kalla's vice presidential candidate, but the ticket won only 12 per- 
cent of the vote to place third. 

Muslim Parties 

National Awakening Party 

Founded by Abdurrahman Wahid in 1998 as the heir to the Nahd- 
latul Ulama political party from the 1950s, the National Awakening 
Party (PKB) is the most successful of the Muslim parties that have 
tried to draw on Nahdlatul Ulama 's vast organizational strength. 
Although formally Nahdlatul Ulama is not associated with any of 
these parties, it is the backbone of them all, including the PKB. 
Nonetheless, the PKB certainly does not have a monopoly on the 
political loyalties of Nahdlatul Ulama supporters, who are scattered 



268 



Supporters of the Indonesian Democracy Party-Struggle (PDI-P) 
march in a campaign parade, Sulawesi Utara Province, 2004. 
The banner, shown here in reverse, touts the No. 12 candidate on the ballot 
for the Regional Representative Council (DPD). 

Courtesy Anastasia Riehl 

among nearly all the major and some minor parties. Following the 
geographic pattern of Nahdlatul Ulama's organizational depth and 
Wahid's personal cachet, the PKB's electoral strength is concen- 
trated in Jawa Timur and Jawa Tengah. 

The PKB does not support the rigid implementation of Islamic law 
and is an open party with support in parts of Indonesia with significant 
Christian populations, such as in Sulawesi Utara, Kalimantan Barat, and 
Papua. Because of Wahid's personal control over the PKB, his and the 
party's fortunes moved more or less in tandem. He used the PKB's per- 
formance in the 1999 legislative elections (third-largest party with 12.6 
percent of the vote and 5 1 DPR seats) as a springboard to build a coali- 
tion behind his successful presidential bid that year in the MPR voting. 
Wahid's erratic administration reflected poorly on the PKB as well, and 
the party lost some of its public support, as well as access to patronage 
and the bully pulpit, when he was removed from office in July 2001 . As 
a result, in 2004 the PKB lost two percentage points of its 1999 vote 
share, dropping to 10.6 percent in 2004. (Nonetheless, because all five 



269 



Indonesia: A Country Study 

of the major parties from 1999 lost support in 2004, the PKB retained 
the third-largest party share of the popular vote.) After Wahid lost the 
presidency, the party began to splinter, and the 2004 election results 
caused a major split, with both pro- and anti- Wahid factions claiming 
the PKB's mantle. At the outset of the new administration, the party 
took an independent stance vis-a-vis President Yudhoyono, sometimes 
supporting and sometimes opposing his policies. However, by 2007 the 
PKB had swung around much more solidly in support of the administra- 
tion because of Yudhoyono 's success and Wahid's complete loss of con- 
trol over the party. As a result of party splintering, reduced support 
overall for Muslim and Islamist parties, and greater competition from 
secular nationalist parties, the PKB vote share was more than halved in 
2009 to 4.9 percent (28 DPR seats). 

National Mandate Party 

Paralleling the PKB's relationship with Nahdlatul Ulama and 
Wahid, the National Mandate Party (PAN) is strongly associated with 
Muhammadiyah and political-science professor Amien Rais from Yog- 
yakarta. Beginning in the early 1990s, Rais became a thorn in Suharto's 
side, calling for presidential succession and highlighting cases of cor- 
ruption and other malfeasance. Despite (or perhaps because of) this 
vocal opposition, he was elected chair of Muhammadiyah in 1995. In 
1998 he became the most prominent adult face of the student-led refor- 
masi (see Glossary) movement, which succeeded in forcing Suharto's 
resignation. (Wahid had had a stroke in January 1998, and Megawati 
remained on the sidelines.) Following the founding of the PAN in 
August 1998, Rais had to step down as Muhammadiyah 's chair. 
Although founded as an open party, with Christians and ethnic Chinese 
prominent among its leadership, the PAN also has a significant hard- 
line Islamist wing. As that wing gained ascendancy within the party, 
many of the PAN's initial secular and Christian leaders began to aban- 
don it. While few of these leaders were linked to mass-based organiza- 
tions that could deliver votes, they were among the key intellectual 
capital in the party, and their departure also fostered the perception of a 
party in trouble. 

In the 1999 elections, the PAN fared worse than had been expected, 
given Rais's prominence in opposing Suharto, winning only 7.1 per- 
cent of the popular vote (34 DPR seats). Although this result dashed 
his presidential ambitions, it was enough, combined with clever polit- 
ical maneuvering, for Rais to be elected speaker of the MPR. From 
this position, Rais chose to involve himself more in politicking 
against presidents Wahid and Megawati than in the constitutional- 
reform process being undertaken by the MPR. This strategy may have 



270 



Government and Politics 



hurt the PAN, for it reinforced the public perception of Rais as stri- 
dent, divisive, and having abandoned the reformasi movement for 
sheer power politics. In addition, the PAN's poor showing weakened 
Rais's position within the party, enhancing the ascendancy of the Isla- 
mist wing and leading to further defections by members of the secu- 
lar/Christian wing. 

The Islamist wing's hypothesis that a more focused albeit more 
narrowly based party would attract more voters than a less focused, 
but broader-based, party was proven wrong in the 2004 elections, in 
which the PAN's share of the popular vote shrank to 6.4 percent (52 
DPR seats), making it the smallest of the seven major parties. (The 
PAN's support in 2004 was more evenly spread around the country 
than in 1 999, and so its share of DPR seats actually increased from 
7.4 percent to 9.5 percent.) Although Rais tried his hand in the first 
direct presidential election, he lost in the first round and subsequently 
left the political scene after completing his term as MPR speaker in 
October 2004. He was replaced as PAN chair by a much less well- 
known figure, Sutrisno Bachir, and returned to his former life as an 
academic at Universitas Gadjah Mada in Yogyakarta. With several of 
its leaders holding cabinet posts in the Yudhoyono administration, the 
PAN mostly supported the administration, although it has reserved 
the right to criticize on occasion. In 2009 the PAN's support declined 
to 6.0 percent of the vote (46 DPR seats), because of waning overall 
support for Muslim and Islamist parties as well as greater competition 
from the DP, Gerindra, and Hanura parties. 

Islamist Parties 

Development Unity Party 

The Development Unity Party (PPP; often erroneously referred to as 
the United Development Party) was the umbrella grouping formed 
when the government compelled four Muslim parties to merge in the 
1973 restructuring of the party system. The four components were Nah- 
dlatul Ulama, the Muslim Party of Indonesia (PMI), the Islamic Associ- 
ation Party of Indonesia (PSII), and the Islamic Educational Movement 
(Perti). The PPP's constituent parties neither submerged their identities 
nor merged their programs. As a result, no single PPP leader emerged 
with a platform acceptable to all the sectarian and regional interests rep- 
resented by the PPP. Despite their manifest differences representing 
divergent santri streams, however, the PPP's parties had the common 
bond of Islam, and it was this that gained them the government's close 
attention. 



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Indonesia: A Country Study 

The dominant partners were Nahdlatul Ulama and the PMI; the lat- 
ter was a resurrected but emasculated version of Masyumi, which had 
been banned in the Sukarno era and continued to be proscribed under 
Suharto. The return of modernist Islamic interests (represented by the 
PMI) to mainstream politics was stage-managed by the government, 
which apparently favored the PMI within the PPP to counterbalance 
the appeal of Nahdlatul Ulama. In 1984 the government forced the PPP 
to adopt Pancasila (as opposed to Islam) as its basic ideological princi- 
ple. The decline in Nahdlatul Ulama's influence in the PPP, together 
with constraints on the Islamic content of the PPP's message, con- 
firmed the traditionalists' perception that Nahdlatul Ulama should 
withdraw from the political process and concentrate on its religious, 
social, and educational activities. The theme of Nahdlatul Ulama's 
1984 congress was "Back to Nahdlatul Ulama's Original Program of 
Action of 1926." While constitutionally accepting Pancasila as its sole 
ideological principle, Nahdlatul Ulama opted out of the Pancasila polit- 
ical competition by holding that political party membership was a per- 
sonal decision and that individual Nahdlatul Ulama members had no 
obligation to support the PPP. 

Nahdlatul Ulama's withdrawal from the PPP combined with Mega- 
wati's rise in the PDI to shift some of the opposition votes from the 
PPP to the PDI in the 1987 and 1992 elections. In the 1997 elections, 
after her forcible ejection from the PDI offices in 1996, Megawati 
instructed her supporters to vote for the PPP. This was called the 
"Mega-Bintang" campaign (bintang means "star," the party symbol 
for the PPP, which after 1984 was no longer allowed to use the Kaaba 
in Mecca as its symbol), and it greatly weakened the PDI, to the PPP's 
benefit. One consequence of these election results was that in late 

1998 and early 1999, as the DPR debated the package of laws for the 

1999 democratic elections, the PPP positioned itself as the voice of 
the reformasi movement within the legislature and forced several 
important changes to those laws. For instance, Golkar proposed an 
electoral system it called "proportional plus" that would in essence 
have established single-member districts in many parts of the country. 
Given Golkar's overwhelming resource advantage at the time, it 
could have swept many of these seats and possibly maintained its grip 
on power. Instead, the PPP was able to use its position in the DPR to 
mobilize public opposition to this proposal, which was dropped in 
favor of retaining proportional representation in order to encourage 
political pluralism. In light of the founding of rival parties such as the 
PKB and the PAN, this tactic helped save the PPP from fading into 
political obscurity as has the PDI. 



272 



Government and Politics 



In 1 999 the PPP was allowed to restore Islam as its ideological basis 
and the Kaaba as its symbol, and it won 10.7 percent of the popular 
vote (58 DPR seats) to become the fourth-largest party. The PPP sup- 
ported Wahid for president and was rewarded with several cabinet 
positions. During the constitutional-reform process following those 
elections, the party supported the reinsertion of language calling for 
Islamic law to be established for Indonesian Muslims, in part to protect 
its right flank from smaller but harder-line Islamist parties. This is one 
of the markers that distinguishes "Muslim" from "Islamist" parties: the 
PKB and the PAN opposed this proposal, which eventually was 
soundly defeated. Party leadership rivalries caused a faction to break 
off and form the Reform Star Party (PBR). The PBR proved to be one 
of the few splinter parties to gain any significant share of votes in the 
2004 legislative elections, winning 2.4 percent (13 DPR seats). The 
split, combined with voter disappointment with the performance of all 
the major parties, caused the PPP's vote share to drop to 8.2 percent 
(58 DPR seats), but it still maintained its position as the fourth-largest 
party by popular vote. The PPP supported a rival ticket in the first 
round of the 2004 presidential election, although it threw its weight 
behind Yudhoyono and Kalla in the second round and again garnered 
several cabinet seats as a result. In 2009, although the PBR won only 
1.2 percent of the vote and no DPR seats because of the electoral 
threshold, the PPP vote share slid to 5.3 percent (38 DPR seats) as a 
result of overall voter dissatisfaction with Muslim and Islamist parties. 

Prosperous Justice Party 

The Prosperous Justice Party (PKS) contested the 1999 elections 
as the Justice Party (PK), founded in 1998. Because the PK won only 
1.4 percent of the popular vote in 1999 (seven DPR seats), the law 
required it to change its name in order to contest the 2004 elections. 
The PK drew on networks of university campus-based Quranic study 
groups as its organizational backbone. Nearly all of its leaders had 
advanced degrees, mostly from universities in the Middle East and 
the United States. The party's emphasis on Islamic law limited its 
appeal in 1999. The PK spoke frequently of its vision for managing 
religious pluralism in Indonesia as being based on the Medina Char- 
ter, promulgated in AD 622 by the Prophet Muhammad, who guar- 
anteed protection for Christian and Jewish communities. Many non- 
Muslims in Indonesia, however, interpreted this as a form of second- 
class citizenship under Islamist rule. Despite the party's low vote 
total, President Wahid appointed its leader, Nur Mahmudi Isma'il, 
minister of forestry. Nur Mahmudi set an unusual precedent in Indo- 
nesian politics by stepping down from the party presidency upon 



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Indonesia: A Country Study 

entering the government, in order to concentrate on his role as a min- 
ister. The PK also enhanced its influence by joining the PAN to form 
the Reformasi Bloc in the DPR and the MPR. 

The party also set about expanding its base as part of its transfor- 
mation from the PK to the PKS. The PKS is unusual in that it is the 
only true cadre party in Indonesia. It requires prospective members 
to study party doctrine and regulations and to take an oath of loyalty 
to those principles. The party has disciplined or expelled members 
for violating these principles. Party members may also attend regular 
training programs. The party's support base remains more heavily 
urban and more highly educated than the general voting population, 
but it has begun to make inroads in rural areas. 

The PKS quintupled the PK's 1999 share of the vote in 2004 to 
7.3 percent of the popular vote (45 DPR seats), largely by emphasiz- 
ing themes of anticorruption and good governance in its campaign 
and de-emphasizing Islamic law. Although all the parties cam- 
paigned on fighting corruption, the PKS came across as the most 
credible in this regard, for two reasons. First, the party exploited its 
reputation for religiosity as a source of morally based and clean gov- 
ernance, and some voters differentiated between this and the estab- 
lishment of Islamic law. Second, PK leaders and legislators had 
developed a track record in the 1999-2004 term. Minister of For- 
estry Nur Mahmudi attempted to purge the industry of some of its 
most unsavory practices and business partners. Although he did not 
last long in office, and his efforts met with only limited success, they 
helped burnish the PKS's reformist credentials. Provincial and dis- 
trict legislators across the country had continued the New Order 
practice of voting themselves large allowances, often ostensibly for 
official vehicles or uniforms. PK legislators made a point of very 
publicly returning these questionable allowances to the local trea- 
sury or donating them to a mosque or community group. The party 
used the newspaper clippings describing these actions in its 2004 
campaign. The PKS also developed a reputation for conducting 
peaceful and orderly campaign rallies, and for cleaning up after its 
followers when the rallies were over. These actions made the party 
especially popular in Jakarta, where it won the largest share of votes 
in the 2004 legislative elections. 

The party's success landed its president, Hidayat Nur Wahid, the 
position of MPR speaker for the 2004 term. Following party regula- 
tions, he stepped down from his leadership role upon accepting this 
government position. In 2005 Nur Mahmudi Isma'il was directly 
elected mayor of Depok, the city on the western outskirts of Jakarta 
that is home to Universitas Indonesia. The party intended to use 



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these positions to demonstrate its commitment to clean governance, 
setting its sights on eventually winning the presidency. The party had 
to contend, however, with widespread voter suspicion, among both 
non-Muslims and moderate Muslims, that the PKS's de-emphasis of 
Islamic law was simply a tactical rather than a truly strategic shift. 
The party's stated support for such radical figures as Jemaah Islami- 
yah spiritual leader Abu Bakar Ba'asyir reinforced these concerns. 
These limits on the party's appeal were vividly demonstrated in 
2007, when it failed to win the governor's race in Jakarta despite its 
2004 plurality victory in the city's legislative elections. 

The PKS has won more positions in various levels of government, 
inevitably finding that it has to make hard choices and compromises, 
and its appeal to its more puritanical core constituency has begun to 
suffer. The PKS no longer enjoys the same level of credibility in 
fighting corruption, and thus it has lost its uniqueness and increas- 
ingly come to be viewed as just one more party on the spectrum. 
Although in 2009 it bucked the overall trend of major parties losing 
voter support, its gains were hardly as spectacular as in 2004. In 
2009 its vote share rose slightly to 7.9 percent (57 DPR seats), mak- 
ing the PKS Indonesia's fourth-largest party. 

Elections 

Indonesia has now held three sets of democratic national elec- 
tions, in 1999, 2004, and 2009, following decades of stage-managed 
elections under the New Order. The 1999 elections were the first 
democratic national elections since 1955. Local direct elections for 
governor, mayor, and bupati have been held on a rolling basis in all 
parts of the country since 2005. The political maturity of Indonesian 
voters, combined with extensive monitoring by civil-society groups, 
helped make all of these elections largely free of violence and fraud, 
despite great concerns beforehand to the contrary. 

To be eligible to participate in 1999, parties had to be national in 
scope, with party branches established in at least one-third of the prov- 
inces and one-half of the administrative districts within those provinces. 
A reconstituted General Elections Commission (KPU) administered the 
elections. It consisted of 48 representatives of the parties and five "gov- 
ernment" representatives. (To avoid perceptions of continuity with the 
authoritarian management of elections under the New Order, the 
Habibie government chose to fill these positions with members of civil 
society and academia.) Although this structure functioned well to signal 
a clean break with the past and a level playing field for all parties, it 
broke down both in the run-up to the elections (when many of the party 
representatives were off campaigning) and following the elections 



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Indonesia: A Country Study 

(when most of the 48 parties won few votes or seats and began making 
unfounded allegations of fraud and boycotting KPU meetings). 

Since 2002 the KPU has consisted of nine nonpartisan commis- 
sioners selected by the DPR from a longer list of candidates nomi- 
nated by the president from civil society and academia. The 1999 
elections continued the New Order practice of a closed-list propor- 
tional-representation system with the provinces as the electoral dis- 
tricts for the DPR; thus, the districts ranged in size from four seats 
(in former Timor Timur Province, now independent Timor-Leste) to 
82 seats (Jawa Barat). These were simultaneous elections for the 
national DPR and the provincial and local DPRDs; each voter used a 
nail to punch a hole in one of the 48 party symbols on each of the 
three ballots. These legislative elections were followed by the presi- 
dential selection process within the MPR in October. Governors, 
mayors, and bupatis were selected by their respective DPRD. 

The 2004 and 2009 elections were more complicated than those in 
1999. There were three electoral processes: legislative elections in 
early April, the first round of the presidential election in early July, and 
the second round in September (necessary in 2004 but not in 2009). 
The vote for the legislative entities consisted of four separate and 
simultaneous elections, not just three as in 1999 and throughout the 
New Order. In addition to the DPR and the provincial and district 
DPRDs, voters now also elected representatives to the new upper 
house of the national legislature, the Regional Representative Council 
(DPD). 

Two reforms addressed the complaint that representatives in the 
DPR and DPRDs had been too detached from their constituents. First, 
electoral districts were limited to between three and 10 seats (for 2009; 
in 2004 the upper limit was 12 seats). In the 19 least populated prov- 
inces, this rule meant that the province remained the electoral district. 
The other 14 provinces were divided along municipality and regency 
boundaries into between two and 1 1 electoral districts in order to fall 
into the mandated seat range. (All of these electoral districts consisted 
of more than one administrative district; in no case was an electoral 
district made up of a single administrative district.) The average DPR 
district across the 77 electoral districts nationwide had approximately 
seven representatives. Second, voters could choose a candidate from 
anywhere on the party's list rather than just voting for a party. This 
open-list proportional-representation system is designed to make rep- 
resentatives more beholden to voters than to party leaders for their 
seats, and, in fact, nearly 20 percent of DPR members in 2009 (104 of 
560) were chosen by voters from lower positions on the candidate 
lists. This method does make election logistics incredibly compli- 



276 



SURAT SUARA PEMILIHAN UMUM 
ANGGOTA DEWAN PERWAKILAN RAKYAT (DPR) 



DAERAH PEMILIHAN 



o 



t 




Ballot with party logos for 2004 elections 
Courtesy Embassy of Indonesia, Washington, DC 



cated; ballots look like newspapers, and each electoral district has to 
have a separate ballot listing its candidates. 

A further complication for voters was that the election system for 
the DPD was entirely different from that for the DPR and DPRDs. 
DPD candidates, who represented entire provinces, campaigned 
more as individuals, even if they were affiliated with a political party. 
(DPD candidates had to have been residing in the province they rep- 
resented and obtain thousands of signatures of registered voters in 
order to be nominated. For the 2004 elections, candidates were not 
allowed to have a political-party affiliation, but for the 2009 elec- 
tions, candidates could be — but did not have to be — partisan.) Candi- 
dates' names and photographs appeared on the ballot. Each voter 
marked one candidate, and the four candidates with the most votes 
were elected. 

The DPR elections served as a sort of primary for the presidential 
election. Parties or coalitions thereof with at least 20 percent of DPR 
seats, or 25 percent of the national DPR vote, were eligible to nomi- 
nate presidential and vice-presidential tickets (this threshold was only 
3 percent of DPR seats in 2004). In 2004 five tickets were nominated: 



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Indonesia: A Country Study 

Susilo Bambang Yudhoyono and Muhammad Yusuf Kalla (winning 
33.6 percent of the vote in the first round) by the PD, Indonesian Jus- 
tice and Unity Party (PKPI), and Star and Moon Party (PBB); Mega- 
wati Sukarnoputri and Hasyim Muzadi (26.2 percent) by the PDI-P; 
Wiranto and Salahuddin Wahid (22.2 percent) by Golkar; Amien Rais 
and Siswono Yudohusodo (14.9 percent) by the PAN, PKS, and sev- 
eral smaller parties; and Hamzah Haz and Agum Gumelar (3.1 per- 
cent) by the PPP. The PKB did not nominate a ticket because its 
presidential candidate, former President Wahid, was declared physi- 
cally unfit for the position (a new criterion instituted in reaction to his 
administration). Because no ticket won more than 50 percent in the 
first round, a second round occurred in which Yudhoyono and Kalla 
soundly defeated Megawati and Hasyim, 60.9 percent to 39.1 per- 
cent, respectively. Three tickets were nominated in 2009: Yudhoyono 
and Budiono by the PD, PKS, PAN, PPP, and PKB (winning 60.8 per- 
cent of the vote in the first round); Megawati and Prabowo Subianto 
by the PDI-P and Gerindra (26.8 percent); and Kalla and Wiranto by 
Golkar and Hanura (12.4 percent). Because Yudhoyono and Budiono 
won more than 50 percent in the first round, a second round was not 
necessary. 

The huge rallies of motorcycles, automobiles, and trucks cruising 
around cities, hallmarks of previous Indonesian campaigning, were 
banned beginning in 2004. Mass rallies in stadiums and other venues 
were still one of the most popular campaign techniques, although the 
open-list system for the DPR and the DPD elections did prompt 
more frequent door-to-door campaigning than had been the case pre- 
viously. Television proved to be a significant campaign medium in 
the presidential election, and Yudhoyono used it particularly effec- 
tively in 2004 to overtake other, better-known candidates. Other can- 
didates were busy lining up endorsements from political parties and 
political elites, but Yudhoyono tried to get coverage of his campaign 
rallies on the news every evening. In this way, he turned a nominat- 
ing coalition that together had won only 11.4 percent of the vote in 
the legislative elections in April into convincing victories in both 
rounds of the presidential election. 

Political finance continues to be problematic in Indonesia. Both 
parties and candidates fund raise for executive and legislative elec- 
tions. Election laws include limits on donations, although these regu- 
lations are poorly enforced, and spending is not limited. Most parties 
require legislative candidates to donate to party coffers in exchange 
for a place on the list; as a general rule, the higher the financial dona- 
tion, the closer a candidate is placed to the top of the list. Even in an 
open-list system, placement near the top is advantageous. Similarly, 
most parties require local executive candidates to donate in exchange 

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Government and Politics 



for nomination, a situation that creates incentives for elected candi- 
dates to engage in corruption in order to recoup these payments and 
begin amassing funds for future elections. The process has been over- 
seen, in all the national and local elections since 1999, by an official 
Election Oversight Committee (Panwaslu) system. However, the law 
has granted this system few real powers except to be a repository for 
complaints; any serious matters must still be handled by the police 
and the judicial system. The system is also underfunded, hampering 
its efficiency. More effective monitoring and observation of the elec- 
tions since 1999 have been conducted by political parties, domestic 
civil-society groups, the media, and international organizations. The 
parties and domestic groups in particular have mobilized and trained 
hundreds of thousands of volunteers to monitor the process and report 
election results. 

Political Dynamics 

Political Opposition 

President Yudhoyono's first term in office was marked by repeated 
natural and other environmental disasters. These included the Aceh 
earthquake and tsunami in December 2004, the Yogyakarta earth- 
quake in May 2006, the Lumpur Sidoarjo (Lusi) mud volcano in Jawa 
Timur beginning in May 2006, the Pangandaran earthquake and tsu- 
nami in July 2006, forest fires in Sumatra and Kalimantan that caused 
choking haze in Malaysia and Singapore in October 2006 and 2007, 
massive floods in Jakarta in February 2007, and the Tasikmalaya and 
Padang earthquakes in September 2009. Despite these and other chal- 
lenges, Yudhoyono remained quite popular; public-opinion polls gen- 
erally gave him an approval rating between 40 and 60 percent. His 
continued popularity created problems for the formation of a sus- 
tained opposition, and he exploited this situation to shore up his legis- 
lative support. Having only Megawati as a strong challenger, he was 
easily reelected in 2009. 

The Yudhoyono-Kalla administration's consolidation of its politi- 
cal position began within months of taking office. Golkar, the PDI-P, 
the PKB, and the PBR had formed the National Front in opposition to 
the new administration and had swept all DPR leadership positions. 
At Golkar's December 2004 congress, however, Kalla was elected to 
be the new party chairman just days before the Aceh tsunami. This 
broke up the National Front and brought the largest party solidly 
behind the vice president (if not always the president himself). 

Yudhoyono also managed to neutralize the PKB, PAN, and PPP so 
that even though these parties were not solid supporters, neither were 
they strident opponents. The PKB has suffered from internal rivalries 



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Indonesia: A Country Study 



between pro- and anti-Wahid factions, both of which have claimed 
control of the party. Wahid remained a frequent critic of the president, 
although even his own faction in the party leadership drew closer to 
the administration in order to sideline their opponents within the 
party. Wahid himself suffered further health problems and died in 
December 2009. PAN leaders had held several seats in the cabinet 
since the beginning of the Yudhoyono administration, but the party 
remained at arm's length from the president until its founder, one-time 
presidential rival and frequent critic Amien Rais, stepped down as 
chair and retired from active engagement in politics at the party con- 
gress in 2005. A similar dynamic occurred within the PPP, led until 
the party congress in 2007 by former Vice President Hamzah Haz, 
another of Yudhoyono's rivals in the 2004 election. The party elected 
then-Minister for Cooperatives and Small and Medium Enterprises 
Suryadharma Ali to be its new chairman over Arief Mudatsir Man- 
dan, a DPR member supported by Haz. This left the PDI-P as the 
only one of the seven major parties remaining as a consistent member 
of the opposition. Following the 2009 elections, the PDI-P was joined 
in opposition only by the two smallest parties in the DPR, Gerindra 
and Hanura. 

Islam 

The reformasi period has witnessed a great debate among four 
camps within Islam in Indonesia: extremists, conservatives, moder- 
ates, and liberals. These camps exist within both the traditionalist 
and modernist streams of Islam in Indonesia. The smaller and more 
marginalized of these camps are the extremists and the liberals on 
the right and left fringes of the debate, respectively; the bulk of the 
debate is thus in the center of this spectrum between the conserva- 
tives and the moderates. 

The extremists are the groups and individuals that have been 
involved in acts of terrorism, communal violence, and small-scale 
thuggery and extortion; what sets them apart from the other three 
camps is their use of violence. These groups and individuals partici- 
pate in the debate mainly through actions rather than words; surpris- 
ingly, their information campaigns have been limited. Terrorism has 
mainly been associated with Jemaah Islamiyah, Al Qaeda's South- 
east Asian affiliate, whose spiritual leader is Abu Bakar Ba'asyir. 
Jemaah Islamiyah has been associated with the five most prominent 
terrorist bombings in Indonesia in recent years: in the Kuta tourist 
district in southern Bali in October 2002 and October 2005, the JW 
Marriott Hotel in Jakarta in August 2003, the Australian Embassy in 



280 



Government and Politics 



Jakarta in September 2004, and the JW Marriott and Ritz-Carlton 
hotels in Jakarta in July 2009. 

Communal violence has been associated mainly with organizations 
such as Laskar Jihad, a Java-based group that involved itself in the con- 
flicts in Maluku and Sulawesi Tengah. These organizations often justi- 
fied their actions by claiming that they intervened to defend Muslims 
from physical attack by Christians. In all of these communal conflicts, 
however, while religious affiliations were used to mobilize people on 
all sides, the roots of the conflicts were much deeper and more com- 
plex; religion was and continues to be layered with ethnic, economic, 
political, and personal rivalries. The involvement of these organizations 
thus simply served to polarize and extend the conflict even further. 

Thuggery and extortion are the realm of groups such as the 
Islamic Defenders' Front (FPI), which consists of criminal gangs 
posing as social organizations in a very similar manner to New 
Order-era groups such as Pancasila Youth (Pemuda Pancasila). The 
main difference is that the FPI uses Islamic rather than nationalist 
symbols and slogans to mobilize supporters and neutralize critics. 
The FPI and similar groups have raided bars and discos, held violent 
demonstrations at the offices of the Indonesian edition of Playboy, 
and so forth. These groups likely have numerous motives for their 
actions, including both religious convictions and the desire for pro- 
tection money in exchange for leaving such businesses alone. 

Conservatives have concentrated their efforts on incorporating 
Islamic law into Indonesian daily life in various ways. Their initial 
efforts focused on reinserting the phrase from the Jakarta Charter ("with 
Muslims obligated to follow the sharia") into the 1945 constitution as 
part of the amendment process from 1999-2002. This proposal, most 
strongly supported by the PK and the PBB, but also by the PPP to cover 
its right flank from these two smaller parties, was soundly defeated in 
the MPR in 2002. The conservatives then took advantage of decentral- 
ization to win approval by various district and municipality assemblies 
of local regulations implementing several aspects of Islamic law, espe- 
cially those commonly used to regulate women's dress and behavior. 
These regulations may be unconstitutional, as religion is one of the six 
major policy areas reserved for the central government under decentral- 
ization; however, as of 2009 none of these regulations had been chal- 
lenged before the Constitutional Court. 

Local implementation of Islamic law became institutionalized in the 
special-autonomy law for Aceh, despite the fact that this was not a pri- 
mary Acehnese demand. Resulting developments include a religious 
police force for Aceh and the drafting of regional regulations, such as a 
punishment for theft that involves cutting off the perpetrator's hand. 



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Indonesia: A Country Study 

Aceh governor Irwandi Yusuf, a former rebel leader, has vowed not to 
enforce such regulations even if they are approved. 

Moderates still represent the vast majority of Indonesian Muslims. 
Although large organizations such as Nahdlatul Ulama and Muham- 
madiyah are internally diverse, including conservatives, moderates, 
and liberals among their members, they remain dominated by moder- 
ates. Of the two, however, Muhammadiyah has tended to be more 
conservative than Nahdlatul Ulama. As the dominant majority faced 
with rising extremism and a newly resurgent conservative minority, 
moderates have been put on* the defensive. They have often struggled 
to make their voices heard without being labeled lackeys of the West 
or apostates. The main distinction between conservatives and moder- 
ates is that the former want Islamic law codified and enforced as part 
of Indonesian law, whereas the latter see it more as a set of rules for 
personal behavior, enforced only by one's faith and self-discipline. 
Moderates are also much more likely to engage with non-Muslims in 
interfaith initiatives and to speak publicly of tolerance of differences 
and the equality of believers of all faiths. 

There is a small but highly visible group of mostly young intellec- 
tuals and activists from both the traditionalist and modernist streams 
that can be characterized as liberals, pushing the envelope of ijtihad 
(exegesis) with innovative and often highly controversial ideas. Con- 
sistent with this cutting-edge profile, the most prominent organiza- 
tional home for this group is virtual, the Liberal Islam Network 
(JIL), an online discussion forum. The JIL's physical headquarters is 
in the Utan Kayu complex in East Jakarta. This complex was estab- 
lished in the late New Order period by Gunawan Mohammad (the 
leading intellectual and journalist who helped found the news maga- 
zine Tempo) as an incubator for a wide range of creative, opposition- 
minded young people. Many conservatives and extremists have a 
visceral negative reaction to the liberals and have demonstrated at 
the Utan Kayu complex, threatening to expel and shut down the JIL 
and calling for the death of JIL leader Ulil Abshar Abdalla, who 
temporarily fled the country for his own safety. 

The Military 

More than a decade after the beginning of the democratic transi- 
tion, the Indonesian National Armed Forces (TNI) retains the poten- 
tial for significant political influence. This latent influence is rarely 
used in public, however, and may not even be that effective behind 
the scenes. Nonetheless, it exists. The sources of this influence are 
twofold: institutional and cultural. Although the military has been 
stripped of many of the direct powers it enjoyed under the New 



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Government and Politics 



Order, the institutional core of its power — the army's territorial sys- 
tem and the network of off-budget companies, foundations, and 
cooperatives supported by that system — remains intact (see Admin- 
istrative and Command Structure, ch. 5). The Yudhoyono adminis- 
tration has made an inventory of these military enterprises, with the 
aim of transferring them all to civilian state control for privatization 
or closure, a process not complete in 2009. No serious proposals 
have been made to dismantle the territorial system as part of the 
effort to reorient the military to focus on external defense. It is 
important not to overstate the power of this system, which is more 
effective as a subtle threat than in actual use. In fact, the military is 
small relative to the population as a whole, and the territorial system 
is staffed by the more poorly trained and equipped half of the army, 
limiting its ability to move in more than a few cities simultaneously. 
These limitations were clearly evident in 1998 in the face of a 
nationwide, grassroots student movement, and that was a time when 
the military still enjoyed its more direct levers of power. 

The cultural source of the military's latent political influence is 
the public's perception, rightly or wrongly, of officers as firm deci- 
sion makers who consider the national interest in those decisions, as 
opposed to the stereotype of bickering civilian politicians who take 
only their parochial interests into consideration. This perception also 
has its limitations, for the public does not prefer just any officer. 
When given a choice, voters have clearly expressed their preference 
for those with less baggage in terms of human-rights violations or 
corruption. Thus, while it is a sign of this source of influence that 
someone with retired General Wiranto's dismal human-rights record 
could gain 22.2 percent of the vote in the first round of the 2004 
presidential election, missing moving forward into the second round 
by only four percentage points, he was soundly defeated by a candi- 
date with many fewer allegations of human-rights violations and 
much greater credibility in fighting corruption, retired Lieutenant 
General Susilo Bambang Yudhoyono. This pattern repeated itself in 
2009, when Wiranto and Prabowo Subianto, who has an even worse 
human-rights record, were unable to help their presidential tickets 
against Yudhoyono. At the subnational level, there are now many 
fewer governors, mayors, and bupatis with a military background 
than in the New Order. Furthermore, these individuals (like presi- 
dential and legislative candidates) have had to retire from the armed 
forces in order to become involved in politics, and their election does 
not seem to have directly benefited the military as an institution. 

Despite the limitations on the military's institutional and cultural 
sources of political influence, this latent power could be called upon 



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Indonesia: A Country Study 

were Indonesia to have a populist demagogue leader, somewhat 
along the lines of Venezuela's Hugo Chavez. Under the right circum- 
stances (such as economic stagnation), such a leader could offer the 
Indonesian public relief from their economic woes at the cost of a 
rollback of democratic freedoms. Recent commanders have made 
significant progress in instilling a culture of professionalism and 
political neutrality in the military. However, more reforms will be 
necessary to ensure that less scrupulous leaders could no longer use 
the military as a tool of political repression. 

Communal Violence 

One of the greatest fears among the political elite in 1998 was that 
Indonesia would break apart into smaller countries, as had happened 
in the Soviet Union and Yugoslavia. This did not happen, but in var- 
ious parts of the archipelago other developments did begin to mirror 
events in Yugoslavia in the 1990s. Communities that had previously 
coexisted in relative harmony rapidly spiraled into conflict, although 
in Indonesia none of these tensions ever approached the scale of 
communal violence in the former Yugoslavia. 

Sporadic incidents had already begun in 1996 when the New Order 
still appeared quite solid, with church burnings in such places as 
Pasuruan (in Jawa Timur) and Tasikmalaya (in Jawa Barat). The scale 
and geographic spread of violence ramped up significantly, however, 
following Suharto's resignation, as the national government became 
preoccupied with the political transition and security forces could no 
longer repress long-simmering local grievances. In January 1999, fol- 
lowing the expulsion of Ambonese gangs from Jakarta to Ambon, as 
well as the breakdown of informal ethnic power- sharing agreements 
in Maluku Province, a minor traffic accident in Ambon exploded into 
terrible and sustained violence between Muslims and Christians in 
that city. Over the next three years, several thousand members of both 
communities were killed, and parts of the city became no-go zones 
for one group or the other. Extremist Muslim groups such as Laskar 
Jihad — allegedly supported by like-minded senior military officers — 
flocked to Ambon and played a major role in the dramatic expansion 
of violence in that city. The violence that erupted in Kalimantan Barat 
was even more horrific, as indigenous (Christian) Dayaks in rural 
Sambas District went on a rampage against Muslim Madurese in- 
migrants who had taken a prominent role in local commerce and agri- 
culture. Hundreds were killed, some of their severed heads left on 
poles as a warning to others, and many houses burned to the ground. 
Sustained violence also erupted between Muslims and Christians in 
Sulawesi Tengah around the cities of Poso and Tentena, where Laskar 



284 



Government and Politics 



Jihad and the more sinister Jemaah Islamiyah terrorist group had 
established a training camp. At the end of the first decade of the 
twenty-first century, this conflict continues to fester, with sporadic 
incidents of violence by one community on the other. 

Many of these conflicts appear, on the surface, to be between eth- 
nic or religious communities, particularly Muslims and Christians. 
However, deeper analysis reveals that very localized struggles over 
political and economic power are the underlying cause. Unfortu- 
nately, these political and economic struggles have often been framed 
by conflict entrepreneurs as being rooted in ethnic or religious cleav- 
ages, making it easier to mobilize communities against one another. 
External forces have also exacerbated such conflicts. In Ambon, 
security forces were perceived as taking sides, the army with Muslim 
communities and police mobile brigades with Christian communities. 

Yusuf Kalla gained greater political prominence when, as coordi- 
nating minister of public welfare in President Megawati's cabinet, he 
helped mediate negotiations to resolve the longer-running of these 
conflicts in Poso and Ambon. The resulting agreements were called 
Malino I (for Poso) and Malino II (for Ambon), after the location of 
the negotiations. Malino II has largely held, but peace has not yet 
fully returned to Poso. Kalla trumpeted his role in these accords in 
helping Yudhoyono win the 2004 presidential election and drew on 
these experiences in dealings with Aceh as vice president. 

Civil Society 

Indonesia's post-New Order democracy has a civil society that is 
vibrant but that also has fairly shallow roots in the broader citizenry, 
with certain important exceptions. Most Indonesian nongovernmental 
organizations (NGOs) are small urban organizations founded and 
staffed by a handful of former student activists (see Civil Society, ch. 
2). They tend to claim to speak on behalf of "the people" (rakyat) 
broadly or of certain communities, but often they have not bothered 
to reach out to, educate, or mobilize those communities. Many of 
these organizations fail to attract significant support and are short- 
lived; those with larger budgets are often dependent on foreign-donor 
funding. This leaves them open to charges by conservative national- 
ists that they are puppets of foreign governmental interests. 

The proliferation of NGOs since the late 1970s is an indicator of 
the increased diversity of society, the growth of a modern middle 
class, and the penetration of the political culture by issues of global 
concern. These organizations raise issues ranging from human rights 
and the rule of law to corruption and environmental degradation. 
Despite the fact that most NGOs are small grassroots organizations 



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Indonesia: A Country Study 

that focus on economic development and social-welfare issues, many 
of the more prominent NGOs are aggressively intervening in areas of 
agrarian or other fundamental human rights. In the 1990s, these orga- 
nizations also provided a new outlet for student activism, confined 
since the 1970s to nonpolitical behavior. University students found 
both a cause and a vehicle for renewed social involvement. This repo- 
liticization and organizing experience laid the groundwork for the 
student movement of 1998 that toppled Suharto. 

Religious organizations of all denominations are the primary 
exceptions to the rule regarding the shallow nature of Indonesian 
civil society. These organizations, most prominently the two largest 
Muslim associations, Nahdlatul Ulama and Muhammadiyah, had 
been the most successful at resisting New Order control. It is not a 
coincidence that two of the most prominent leaders of the reformasi 
movement, Abdurrahman Wahid and Amien Rais, were the national 
chairs of Nahdlatul Ulama and Muhammadiyah, respectively. In the 
1980s and 1990s, religious organizations also had spawned dozens 
of affiliated NGOs, as younger leaders wanted to translate their faith 
into social activism but found that the parent organizations were not 
nimble enough to do so. However, the parent organizations' national 
networks and penetration down to the village level became a valu- 
able resource during the transition to democracy, as they played a 
prominent role in such activities as civic and voter education as well 
as election monitoring. This involvement demonstrated to both Indo- 
nesian citizens and the world at large that religion (particularly 
Islam) and democracy are not incompatible. 

The legal framework supporting a healthy civil society is much 
stronger than during the Suharto era. President Habibie scrapped the 
rule forcing all organizations to adopt Pancasila as their sole ideolog- 
ical basis. The new chapter in the constitution on human rights con- 
tains unequivocal statements guaranteeing the freedoms of speech 
and assembly. Equally important, these clauses do not just exist on 
paper but also are being enforced. For instance, in two separate land- 
mark rulings in 2006 and 2007, the Constitutional Court struck down 
the sections of the criminal code that outlawed defamation of the 
president and other political leaders and criticism of the state. These 
sections derived from Dutch colonial laws designed to muzzle nation- 
alist leaders, and authoritarian and democratic leaders alike had used 
them against government critics. 

The Media 

Indonesia's new-found freedoms have been felt most strongly by 
the media. Long suppressed and harassed by the New Order, the Indo- 



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nesian press is now among the freest and liveliest in Asia. The trend 
toward somewhat greater pluralism and openness had begun in the 
late New Order, when the regime allowed the founding of a number of 
new television and radio stations. (The television stations all had to be 
Jakarta-based at first.) Many of the new television stations enjoyed 
penetration rates of around 70 to 80 percent of the population within a 
few years. Although the television licenses were all given to various 
Suharto family members, cronies, and other wealthy conglomerates, 
competition for advertising revenue and a large potential national 
audience meant that some of these stations were tempted to push the 
boundaries, especially regarding the ban on news programs other than 
those produced by the state-run Television of the Republic of Indone- 
sia (TVRI). These stations were very lucrative, so it became difficult 
for the regime to punish its own cronies by shutting down a station if 
it crossed the line by broadcasting independently produced news. Sun 
Television (SCTV) and Hawk Television Indonesia (RCTI) news pro- 
grams, in particular, were very popular with viewers across the coun- 
try as an alternative, albeit still relatively tame, to the stultifying 
TVRI (see Post and Telecommunications, ch. 3). Broadcasting is reg- 
ulated by the government through the Directorate General of Radio, 
Television, and Film. 

Thousands of new print publications and radio stations have started 
up across the country, and more television broadcasters, including 
regional stations, have licenses since the transition to democracy. The 
government cannot revoke these publishing and broadcasting licenses 
based on what the outlets write and say. President Wahid further weak- 
ened the government's ability to control the media when he abolished 
the Department of Information at the outset of his administration. The 
censorship board for motion pictures remained in existence, however, 
mainly to police "public morality" (nudity, sexuality) rather than polit- 
ical statements, and President Megawati reestablished the Department 
of Information on her ascension to power. In the absence of significant 
government repression, spurious defamation lawsuits by private indi- 
viduals have become the principal means of stifling media scrutiny. 
The most prominent of these cases involved businessman Tomy 
Winata, who sued Tempo editor in chief Bambang Harymurti. Hary- 
murti was convicted and given a one-year prison sentence, which the 
Supreme Court overturned. 

More than 50 principal daily newspapers are published throughout 
the archipelago, the majority in Java. Those with the largest reader- 
ship are Kompas (Jakarta), circulation of 523,000; Suara Merdeka 
(Semarang), circulation of 200,000; Berita Buana (Jakarta), circula- 
tion of 150,000; Pikiran Rakyat (Bandung), circulation of 150,000; 



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and Sinar Indonesia Baru (Medan), also with a circulation of 
150,000. The largest English-language dailies, both published in 
Jakarta with print runs of 40,000, are the Jakarta Post and the Jakarta 
Globe. The principal weekly news magazines are Tempo, which also 
produces an English-language edition, and Gatra. All of these news- 
papers and magazines have online editions as well. 

Foreign Policy 

Political Considerations 

The internal dynamics of Indonesian politics since independence 
have been linked to an external environment perceived as inherently 
dangerous. Indonesian foreign policy has had as its most important 
goals security of the state and territorial integrity. The jurisdictional 
boundaries of the state were greatly expanded with the incorporation 
of the "archipelago principle" into the new international law of the 
sea, a new regime codified as the UN Convention on the Law of the 
Sea in 1982. The archipelago principle effectively territorialized all 
ocean space inside straight baselines drawn from the farthest points 
of the most distant islands of Indonesia, thus giving new sanction to 
the Indonesian doctrine of the political and security unity of archipe- 
lagic land and sea space (wawasan nusantara), first promulgated in 
the 1950s (see National Territory: Rights, Responsibilities, and Chal- 
lenges, ch. 2). 

Sukarno's response to challenge was to attack the status quo, to 
"live dangerously," to cite his 1964 Independence Day address, "A 
Year of Living Dangerously." Beginning with Suharto, the approach 
of subsequent governments has been one of cooperation and accom- 
modation in order to gain international support for Indonesia's polit- 
ical stability and economic development while, at the same time, 
maintaining its freedom of action. Nonetheless, Indonesia's level of 
engagement with the rest of the world has fluctuated, mainly depen- 
dent on domestic developments: it was high under Sukarno, in the 
latter half of Suharto's three decades in power, and again in the early 
twenty-first century, but low in the first half of the New Order and in 
the transitional period after the 1997-98 Asian financial crisis. 

Sukarno relished leading the "new emerging forces" against the 
"old established forces," whereas subsequent governments have 
turned to the Western developed economies for assistance. From 
1 967 to 1991, countries aiding Indonesia organized as a consortium 
in the Inter-Governmental Group on Indonesia (IGGI — see Glos- 
sary), subsequently reorganized in 1992 without the Netherlands — 
and with Japan as chair — as the Consultative Group on Indonesia 



288 



Government and Politics 



(CGI — see Glossary). These countries, along with the World Bank 
and the Asian Development Bank (see Glossary), gave massive eco- 
nomic assistance, amounting in the 2006 budget to more than 
US$5.4 billion in loans and grants. Even after the Indonesian gov- 
ernment disbanded the CGI in 2007, foreign assistance continues on 
a bilateral basis. The pragmatic, low-profile style of post-Sukarno 
administrations has been a far cry from the radical internationalism 
and confrontational anti-imperialism of his foreign policy, although 
there has been some continuity in a nationalism that colored Indone- 
sia's perceptions of its role in the region. The promotion of Islamic 
international political interests has not been high on the Indonesian 
foreign-policy agenda, despite Indonesia's having the world's largest 
Muslim population. Indonesia is a member of the Organization of 
the Islamic Conference (OIC), but, unlike Malaysia, has not aspired 
to a major role in that organization. 

Following two decades of New Order "low-profile" foreign policy, 
by Suharto's fourth term (1983-88) a more assertive Indonesian voice 
on foreign policy was heard, as Jakarta began to reaffirm its claim to a 
leadership position, both regionally and worldwide, corresponding to 
its geographic vastness, resource endowment, population, and political 
stability. After an international rehabilitative period, Indonesia rejoined 
the community of nations, broke the Jakarta-Phnom Penh-Hanoi-Bei- 
jing-Pyongyang axis, ended the Indonesian-Malaysian Confrontation 
(Konfrontasi — see Glossary), worked to strengthen ASEAN, forged 
cooperative nonthreatening links with its neighbors, and became a 
moderating voice in developing world forums. By the early 1990s, 
Indonesia, which American scholar Donald K. Emmerson could still 
describe as "invisible" in 1987, had become apparent both as a regional 
power and a major developing world voice in the global political and 
economic arenas. In 1992 Indonesian foreign policy reflected a proud 
national identity and what British scholar Michael Leifer called its 
"sense of regional entitlement." 

Indonesia's full reemergence on the world stage was highlighted in 
September 1992 when it hosted the Nonaligned Movement summit, an 
acknowledgment of its credentials to speak authoritatively in the 
developing world. Indonesia had hosted the Asia-Africa Conference 
in Bandung in 1955 and was a founding member of the Nonaligned 
Movement in 1961. Its adherence to and promotion of the ideals of 
nonalignment had been one of the few consistencies between the for- 
eign policies of the Old Order and New Order governments. At the 
same time, Indonesia was the only founding member that had not 
hosted a Nonaligned Movement summit, as a result of the unpopular- 
ity in the developing world of some of its policy positions: its domestic 



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Indonesia: A Country Study 

anticommunism, cold relations with China, incorporation of East 
Timor as Timor Timur Province, and solidarity with ASEAN on the 
Cambodian issue. Suharto used the summit to begin the effort of shift- 
ing the Nonaligned Movement agenda from its traditional concerns to 
the economic and social issues confronting the developing world. The 
Jakarta Message, the summit's final communique, reflected Suharto's 
call in his opening speech for a constructive dialog between the devel- 
oped and developing nations, warning that North-South polarization 
loomed as "the central unresolved issue of our time." In an expression 
of Indonesia's pride in its own development, Suharto offered technical 
assistance to countries with food and population problems. As chair- 
man of the Nonaligned Movement, Suharto brought the Jakarta Mes- 
sage to the 1992 session of the UN General Assembly. 

All of this new-found constructive activism ended in 1997-98 as the 
economy collapsed under the weight of the Asian financial crisis, and 
Suharto was forced to resign. With the exception of President Habibie's 
engagement with the UN on a referendum for East Timor, Indonesia 
once again slipped into the shadows of the world stage as it sorted out 
its economic woes and domestic political transition. This shroud of 
invisibility only began to lift — for all the wrong reasons — in October 
2002, with the first Bali bombing and the subsequent roughly annual 
terrorist attacks in Jakarta and Bali from 2003 to 2005, which contrib- 
uted to making Southeast Asia the "second front" in President George 
W. Bush's "global war on terrorism." Only under President Yudhoyono 
has Indonesia once again returned to a constructively activist foreign 
policy profile. This shift has been most evident in Indonesia's contribu- 
tion of troops, including Yudhoyono 's elder son, Agus Harimurti, a 
junior army officer, to the UN peacekeeping force in Lebanon after the 
2006 war between Israel and Hezbollah. Indonesian military or police 
contingents also were deployed in Congo and Sudan. The shift has also 
been reflected in Yudhoyono 's offers to assist with resolution of con- 
flicts in Iraq, Iran, the Korean Peninsula, and Burma. 

Participation in ASEAN 

Since its founding on August 8, 1967, ASEAN has been a major 
focus of Indonesia's regional international relations, and Jakarta is 
the site of ASEAN 's general secretariat. Founding members Indone- 
sia, Malaysia, the Philippines, Singapore, and Thailand helped con- 
struct a regional multinational framework to facilitate economic 
cooperation, diminish intra-ASEAN conflict, and formulate ASEAN 
positions regarding potential external threats. Brunei joined in 1984, 
and ASEAN further expanded in the late 1990s with the accession of 
Vietnam (1995), Laos and Burma (1997), and Cambodia (1999). In 



290 




2009 the organization was considering Timor-Leste's application for 
membership. 

These countries were not always so cooperative with one another. 
In 1963 the Philippines and Indonesia both tried to prevent or delay 
the formation of the Federation of Malaysia, the Philippines because 
it had its own claim to Sabah (formerly North Borneo) and Indonesia 
because it suspected a British imperialist plot. Indonesia soon turned 
to political and military confrontation, an attempt to undermine the 
new state of Malaysia. Sukarno's radical anti-Western rhetoric, com- 
bined with the growing strength of the PKI, marked Indonesia as a 
disturber of the regional international order rather than a coopera- 
tive, peaceful contributor to it. 

By 1967 Indonesia's disruptive stance had changed. ASEAN pro- 
vided a framework for the termination of the Confrontation, allow- 
ing Indonesia to rejoin the regional community of nations in a 
nonthreatening setting. Furthermore, the five founding members of 
ASEAN now shared common policies of domestic anticommunism. 
The ASEAN process of decision making by consensus allowed 
Indonesia to dictate the pace of change within the organization. 
Some observers asserted that ASEAN moved only at the pace of its 
slowest member, which often was Indonesia. With ASEAN increas- 
ingly seen as a symbol of regional peace and stability, its strength 
became an end in itself in Indonesian foreign policy. Suharto became 
ASEAN's elder statesman by the time of ASEAN 's Fourth Summit, 
held in Singapore January 27-29, 1992. He was the only head of 
government at ASEAN's 1967 establishment to attend the ASEAN 



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Indonesia: A Country Study 

First Summit, held in Bali, February 23-24, 1976, who was still head 
of government in the early 1990s. In the meantime, Indonesia had 
played a key role in resolving the Cambodian conflict, setting the 
stage for ASEAN's expansion to encompass nearly all of the region 
by the end of the millennium. 

Indonesia, ASEAN, and the Cambodian Conflict 

The official ASEAN response, formulated by Indonesia, to Viet- 
nam's December 1978 invasion of Cambodia, was to deplore the 
invasion and call for the withdrawal of foreign forces from Cambo- 
dia. Indonesia and other ASEAN members immediately placed the 
issue on the agenda of the UN Security Council. However, deep dif- 
ferences soon arose between Indonesia and Thailand. Although com- 
pelled to make a show of solidarity with Thailand by its interest in 
sustaining ASEAN, Indonesia began to see the prolongation of the 
war in Cambodia, the "bleeding Vietnam white" strategy, as not 
being in its or the region's interests. Although never retreating from 
ASEAN's central demands of Vietnamese withdrawal from Cambo- 
dia and Khmer self-determination, Indonesia actively sought to 
engage the Khmers and Vietnamese and their external sponsors in a 
search of a settlement that would recognize legitimate interests on all 
sides. Indonesia opened what came to be called "dual-track" diplo- 
macy, in which it pursued bilateral political communication with 
Vietnam while maintaining its commitment to the ASEAN formula. 
By 1986 ASEAN had accepted Indonesia as its official "interlocu- 
tor" with Vietnam. From 1982 to the signing of the Final Act of the 
Paris International Conference on Cambodia on October 23, 1991, 
Indonesian diplomacy played a central role in peace negotiations 
that led to the deployment of forces of the UN Transitional Authority 
in Cambodia (UNTAC). 

Indonesia's sense of achievement and pride in its role in bringing 
peace to Indochina was reflected in three events. On November 12, 
1990, Suharto arrived in Hanoi for the first meeting between an 
ASEAN head of government and a Vietnamese counterpart since Pre- 
mier Pham Van Dong visited Thailand's Prime Minister Kriangsak 
Chomanan in 1977. On March 15, 1992, Japan's Akashi Yasushi, the 
UN undersecretary general for disarmament and newly appointed 
head of UNTAC, arrived in Phnom Penh to be greeted by a color 
guard of Indonesian troops who were part of the first full battalion- 
sized contingent of UNTAC peacekeepers dispatched to Cambodia. At 
the peak deployment of foreign peacekeeping forces in late 1992, 
Indonesia had the largest force in Cambodia with nearly 2,000 mili- 
tary and police personnel, representing 10 percent of the total. Finally, 



292 



Government and Politics 



in mid- 1991, fresh from diplomatic success in helping to end the 
Cambodian civil war, Indonesia took the initiative in seeking to open 
multilateral negotiations on competitive South China Sea claims, 
especially those claims involving jurisdictional disputes over the 
Spratly Islands. Indonesia's gradually assertive role in the Cambodian 
peace effort demonstrated that Jakarta was not entirely willing to place 
its commitment to ASEAN solidarity above its own national interests. 
According to leading Indonesian academic Dewi Fortuna Anwar, the 
"challenge for Indonesian foreign policy in the future is how to main- 
tain a balance between an ASEAN policy which requires goodwill and 
trust of the other members, and satisfying some of the internationalist 
aspirations of a growing number of the Indonesian political elite." 

Reorienting ASEAN in a Post-Cold War Context 

The resolution of the Cambodian conflict, combined with the dra- 
matically altered balance of power in the region, raised the question 
of what new political cement might hold ASEAN together in the 
post-Cold War environment throughout the 1990s and 2000s. Com- 
petitive claims by the nations involved in the jurisdictional competi- 
tion in the South China Sea had the potential for conflict but did not 
pose a direct threat to ASEAN's collective security interest, as had 
the Vietnamese invasion and occupation of Cambodia (see Relations 
with East Asia, this ch.). The answer has come in the nature of the 
post-Cold War environment itself: global unipolarity combined with 
regional multipolarity. The end of the global bipolarity of the Cold 
War has resulted in the hegemony of the United States and ended the 
ability of Southeast Asian states to play off one superpower against 
the other. Regional solidarity has come to be seen as the appropriate 
response to counterbalance a global hegemon. The importance of 
regional solidarity has been enhanced by the political, military, and 
economic rise since the 1980s of China and more recently of India, 
joining longtime powers Russia, Japan, and Australia in increasing 
Asia's geostrategic complexity. Indonesia has decided that only as 
part of a regional bloc can it (and Southeast Asia as a whole) fend for 
itself in this increasingly competitive environment. 

Indonesia has been solidly supportive of ASEAN's response, which 
has been first to expand to encompass nearly all of Southeast Asia (in 
the 1990s) and then to deepen both its internal cooperation as well as 
its relationships with regional and global powers (in the twenty-first 
century). To facilitate internal cooperation, the member states in 2003 
streamlined the organization's various efforts into three pillars: the 
ASEAN Security Community, building on the 1971 Zone of Peace, 
Freedom, and Neutrality (ZOPFAN), the 1976 Treaty of Amity and 



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Indonesia: A Country Study 

Cooperation in Southeast Asia (TAC), and the 1997 Treaty on the 
Southeast Asia Nuclear Weapon-Free Zone; the ASEAN Economic 
Community Blueprint; and the ASEAN Socio-Cultural Community. 
This legal and institutional framework was further strengthened with 
the adoption of the ASEAN Charter, which came into force on 
December 15, 2008. External relationships include: since 1987 allow- 
ing non-Southeast Asian states to accede to the TAC (those that have 
done so include Australia, Britain, China, France, India, Japan, Mon- 
golia, New Zealand, Democratic People's Republic of Korea (North 
Korea), Pakistan, Papua New Guinea, Russia, Republic of Korea 
(South Korea), Sri Lanka, Timor-Leste, and the United States); estab- 
lishing the ASEAN Regional Forum (ARF) in 1994; and inaugurating 
ASEAN Plus Three (China, Japan, and South Korea) in 1999. 

Indonesia's support for the internal and external expansion of 
ASEAN 's reach represented an important shift in its strategic think- 
ing; in ASEAN's first three decades, Indonesia was reluctant to cede 
any significant authority to the supranational organization or to tie 
other powers too closely to it; for example, Indonesia had previously 
resisted the urging of some ASEAN members that the organization 
formally adopt a more explicit common political-security identity. 
Indonesia successfully opposed Singapore's proposal at the ASEAN 
Fourth Summit in 1992 that would have invited the UN Security 
Council's five permanent members to accede to the TAC. In part, 
Indonesian ambivalence about an ASEAN security role, together with 
its reluctance to mesh its economy with an ASEAN regional econ- 
omy, had arisen from Indonesia's desire to keep its options open as it 
pursued its interests, not just as an ASEAN member, but as an 
increasingly important Asia-Pacific regional power. 

The economic and political turmoil generated by the 1997-98 
Asian financial crisis sidetracked Indonesia's efforts to enhance its sta- 
tus as an important middle power for about a decade. In the aftermath 
of that crisis, as well as in the context of post-Cold War global and 
regional power structures, Indonesia has concluded that its own politi- 
cal and economic security interests are best served by strengthening 
ASEAN. To avoid a repeat of the financial crisis, within the organiza- 
tion Indonesia has supported the Roadmap for Financial and Monetary 
Integration of ASEAN (a part of the ASEAN Economic Community), 
and externally the ASEAN Plus Three forum has launched the Chiang 
Mai Initiative to address regional financial stability. 

Indonesia's fundamental interests have not changed substantially, 
and Indonesian nationalism retains a xenophobic streak. One of the 
country's most consistent foreign-policy goals has been to reduce 
regional dependence on external military powers. It has also worked 
assiduously to dampen or end regional conflicts that often have cre- 



294 



Government and Politics 



ated openings for greater external meddling in the region's affairs. 
What has changed is Indonesia's perception of the most effective 
means to serve these interests. As a valuable instrument for wielding 
noncoercive regional influence and gaining attention in the wider 
international arena, ASEAN has become one of the platforms from 
which Indonesia can enhance its profile as a middle power with inter- 
national aspirations. 

Relations with Neighboring Nations 

Fears on the part of Indonesia's neighbors in previous decades that 
its desire to play a larger international role would also carry with it an 
inclination to become a regional hegemon have been much reduced in 
the twenty-first century. Indonesia's abandonment of support for the 
East Timorese pro-integration militias after their forcible ejection into 
West Timor (Nusa Tenggara Timur Province) in late 1999 by the UN- 
mandated International Force in East Timor (INTERFET, 1999- 
2000), its positive response to the independent government of Timor- 
Leste's proffer of peace, and its efforts to convince Burma's junta to 
pursue meaningful national reconciliation have helped erase the mem- 
ories of Sukarno's and Suharto's more expansive foreign policies. 

Timor-Leste 

Timor-Leste, the former Portuguese Timor and then East Timor, 
was incorporated into the Republic of Indonesia in 1976 as Timor 
Timur Province, although Portugal never recognized what it saw as 
forcible annexation. The status of East Timor also remained on the 
UN agenda. Indonesia had invaded in December 1975 in reaction to a 
chaotic decolonization process that had led to civil war. The human 
cost of the civil war, Indonesian military actions, and the famine that 
followed was heavy. Estimates of Timorese deaths between 1975 and 
1999 because of the conflict range from 100,000 to 250,000, out of a 
total population of less than 1 million. The ability of the Revolution- 
ary Front for an Independent East Timor (Fretilin — see Glossary) to 
mount a low-intensity resistance, the draconian countermeasures 
adopted by Indonesian military forces against suspected Fretilin sym- 
pathizers, and charges of Indonesian aggression combined to make 
the status of East Timor a continuing foreign-policy problem for 
Indonesia through the late 1990s. 

When President Habibie took over in May 1998, his advisers sug- 
gested bold initiatives to address the problem. In early 1999, Habibie 
announced that Indonesia would allow the UN to administer a refer- 
endum in the province on August 30. Although formally the question 
posed to the East Timorese was whether or not they supported having 



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Indonesia: A Country Study 

special autonomous status within Indonesia, it was understood that a 
"No" vote meant support for independence. The referendum offer was 
apparently based on faulty intelligence that claimed majority support 
in the province for integration. Instead of emphasizing the benefits of 
remaining a province of Indonesia, the military and intelligence appa- 
ratus supported pro-integration militia forces that used threats and 
force in an attempt to frighten the populace into a pro-Indonesia vote. 
The use of cellular phones, camcorders, and the Internet brought 
scenes of violence and intimidation to the outside world and caused a 
storm of criticism against ^Indonesia's government and its armed 
forces. Despite the intimidation, the referendum itself proceeded 
smoothly, with 98.6 percent turnout and 78.5 percent voting against 
integration. Within days of the referendum, as these results became 
increasingly clear, the pro-integration militias went on a rampage, 
implementing a well-planned scorched-earth campaign. Although ini- 
tial reports of mass killings later turned out to be exaggerated, hun- 
dreds of thousands of Timorese were internally displaced or became 
refugees streaming across the land border into West Timor. Army and 
militia forces destroyed much of East Timor's infrastructure in the 
process. The situation only stabilized when INTERFET, led by Aus- 
tralia, arrived to restore order. The UN then established a civilian 
administration, the UN Transitional Administration in East Timor 
(UNTAET), to run the country and prepare it for independence, which 
came on May 20, 2002. 

Despite the brutal history shared by Indonesia and Timor-Leste, 
the two nations' relations since 2002 have been surprisingly cordial. 
Given Timor-Leste 's small size, geographic isolation, and depen- 
dence on Indonesia for imports of foodstuffs, fuel, and other vital 
commodities, it has not wished to antagonize its much more power- 
ful neighbor. Indonesia, to its credit, since September 1999 has not 
attempted further military or militia interference in Timor-Leste and 
has welcomed the latter's offer of reconciliation as a way to counter 
criticism by international human-rights groups, block attempts to set 
up an international criminal tribunal, and burnish its reputation on 
the world stage. However, Indonesia has not been cooperative in the 
various efforts regarding truth, justice, and accountability for the 
serious crimes against humanity that took place in the province 
between 1975 and 1999 (see East Timor, ch. 5). 

Papua New Guinea 

In 1975 Papua New Guinea gained independence from an Australian- 
administered UN trusteeship. Since then the 760-kilometer-long border it 
shares with Indonesia's Papua Province has been a focus of mutual sus- 



296 



Government and Politics 



picion. Indonesia has sought through diplomacy and intimidation to pre- 
vent Papua New Guinea from becoming a cross-border sanctuary for 
Free Papua Organization (OPM) separatists. Port Moresby's policy on 
the border situation was conditioned by fears of Indonesian expansion- 
ism and sympathy for West Papuan efforts to defend their cultural iden- 
tity against Indonesianization. The Papua New Guinea government was 
also keenly aware of the military imbalance between the two countries. 

Talks to draw up a new agreement to regulate relations and define 
rights and obligations along the border culminated in the signing on 
October 27, 1986, of the Treaty of Mutual Respect, Cooperation, and 
Friendship. The treaty was, in effect, a bilateral nonaggression pact 
in which the two sides agreed to "avoid, reduce and contain disputes 
or conflicts between their nations and settle any differences that may 
arise only by peaceful means" (Article 2), and promised that they 
"shall not threaten or use force against each other" (Article 7). The 
treaty also provided a basis for building a lasting framework of 
peace and cooperation. The structure for peace was enhanced by the 
1987 ASEAN decision to allow Papua New Guinea to become the 
first non- ASEAN country to accede to the TAC. Indonesia has con- 
tinued, however, to block Papua New Guinea's promotion from 
observer status to full ASEAN membership. 

The 1986 treaty left many issues unresolved. It did not solve, for 
example, the problem of Indonesian Papuan refugees in Papua New 
Guinea. Furthermore, Papua New Guinea did not agree to joint security 
operations in the border regions, and Indonesia did not give categorical 
assurance that its military, in all circumstances, would not cross the 
border. Criticism of Jakarta's policies in Papua persisted in Port 
Moresby. In addition, Indonesia was accused of covert intervention in 
Papua New Guinea's domestic politics. Nevertheless, the tension and 
threat- filled atmosphere that clouded the first decade of bilateral rela- 
tions dissipated considerably. In 1990 the two countries signed a new 
10-year border agreement. In January 1992, in the course of a state visit 
by Papua New Guinea's prime minister, Rabbie Namaliu, the defense 
ministers of the two countries signed a "status of forces" agreement 
regulating rights and obligations when on each other's territory. 
Although the two parties denied that the agreement provided for joint 
security operations, the possibility of rights for Indonesian "hot pur- 
suit" seemed to exist. At that time, Namaliu, reviewing the course of 
relations since the 1986 treaty, said, "ties have never been better." 

Further improvement in the bilateral relationship was marked by 
Vice President Megawati's state visit to celebrate the twenty-fifth 
anniversary of Papua New Guinea's independence on September 16, 
2000, at which time the two countries signed a trade agreement. 



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Indonesia: A Country Study 

Indonesia and Papua New Guinea also established a joint commis- 
sion to improve bilateral communications; the first meeting took 
place on June 6-8, 2004. At the same time, the two foreign ministers 
agreed to the establishment of a mechanism for occasional joint cab- 
inet meetings. Nonetheless, despite Papua New Guinea's status as 
one of only three countries with which Indonesia shares a land bor- 
der, Indonesia places a much higher priority on its relationships with 
its other neighbors, such as Singapore, Malaysia, and Australia. 

Singapore and Malaysia » 

Singapore, ASEAN 's own ethnic Chinese financial and economic 
powerhouse, is geostrategically locked in the often suspicious embrace 
of its Indonesian and Malaysian neighbors. More than 40 years after 
the end of Confrontation, a racially tinged, jealous Indonesian ambiva- 
lence toward Singapore remains strong. On the one hand, Jakarta has 
sought to link Singapore's capital, technology, and managerial exper- 
tise to its own abundant natural resources, land, and labor in an eco- 
nomically integrative process. On the other hand, when the relationship 
has been perceived as imbalanced or harmful, old suspicions have been 
revived. For instance, the Indonesian government has welcomed Singa- 
porean investment in its telecommunications sector. However, because 
those investments issue from Singaporean government-owned firms 
and have involved purchases of shares of the two leading Indonesian 
telecommunications firms, Indosat and Telkomsel, the investments 
have come under the scrutiny of Indonesia's Commission for the Over- 
sight of Business Competition (KPPU). Former MPR speaker, 2004 
presidential candidate, and PAN chair Amien Rais, well-known as a 
sometimes virulent economic nationalist, has publicly supported the 
KPPU's scrutiny of the investments. There is also great resentment in 
Indonesia that Singapore has served as the most prominent offshore 
haven for Indonesian crony capital flight, exacerbating the 1997-98 
financial crisis, and for harboring the fleeing cronies themselves. In 
April 2007, the two countries signed an extradition treaty, which was 
warmly welcomed in Indonesia as a means of helping bring to justice 
some of the worst offenders in the financial crisis. However, a streak of 
nationalism surfaced again in the DPR, where enough members 
objected to certain provisions of a parallel defense arrangement that the 
DPR refused to approve the treaty. 

This pattern of ambivalence has been replicated at the subnational 
level over the now largely stalled development of the SIJORI growth 
triangle, which includes Singapore, Malaysia's state of Johor, and 
Indonesia's Riau Province (see Industry, ch. 3). Through the 1990s, 
Indonesia continued to perceive the growth triangle in terms of func- 



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tional interdependence in joint economic development at the maritime 
core of ASEAN, and local and regionalized economic cooperation 
strengthened a common interest in good relations. Since the turn of the 
century, however, Indonesia has viewed aggressive Singapore private 
and state capital as taking on exploitative characteristics, threatening 
to turn Indonesian cheap labor, land, and water into a colonial-style 
dependency. Jakarta has thus banned any further exports of sand that 
had been feeding Singapore's unquenchable construction appetite. 

New interdependencies between Indonesia and Singapore have also 
been forged in the unlikely area of security cooperation, although 
these have demonstrated their limits as well. An unprecedented degree 
of military cooperation through personnel exchanges, joint military 
exercises, and a joint air-combat range has allowed Singapore to dem- 
onstrate its value as an ally in a South China Sea security environment 
(see Branches of Service, ch. 5). Influential nongovernmental Indone- 
sian voices openly promoted military trilateralism among Indonesia, 
Singapore, and Malaysia. In 1995 Indonesia and Singapore signed a 
treaty allowing the use of Indonesian airspace and territorial waters for 
training by Singapore's air force and navy. Negotiations began in 2005 
to extend this treaty into a broader bilateral defense cooperation agree- 
ment, which was bundled into a package with the extradition treaty. 
Nonetheless, the new defense treaty, signed with much fanfare in April 
2007, was set aside in October because of objections raised by the 
DPR during the ratification process that it only benefited Singapore. 
The treaty was still pending at the decade's end. 

In the years after the end of Confrontation, Indonesian-Malaysian 
relations improved as both governments became committed to 
development and cooperation in ASEAN. This new warmth was 
reinforced by the natural affinities of race, religion, culture, and lan- 
guage. Although intensive and extensive bilateral ties have generally 
promoted good relations, these have been tested by irritants such as 
Indonesian concerns about Malaysia's handling of illegal Indonesian 
temporary workers, and Malaysian (and Singapore) concerns about 
chronic haze during the dry season produced by Indonesian planta- 
tion owners setting fires to clear the land for planting. The more con- 
ciliatory tone set by Malaysian prime minister Abdullah Badawi 
helped in overcoming these irritants. 

Australia 

The most problematic of Indonesia's neighborly relations are those 
with Australia. The tension inherent in the population differential 
between the two countries in such close geostrategic proximity is 
exacerbated by their very different political cultures. Criticism of 



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Indonesia: A Country Study 

Indonesia under Suharto in the 1980s and 1990s by the Australian 
press, academics, and politicians provoked angry retorts from Jakarta. 
More recently, East Timor and Papua have been the primary irritants 
in the bilateral relationship. Since 1975 Australia had served as one of 
the primary locations for the East Timorese diaspora, and many Indo- 
nesians suspected Australia of wanting to break up the country by 
supporting East Timor's independence movement, including during 
the 1999 referendum. For many Indonesians, these suspicions were 
confirmed when Australian troops were the first to arrive in Dili in 
September 1999 and made up the largest contingent within INTER- 
FET, which was commanded by an Australian. Indonesian fears that 
Australian attention had turned to Papua once Timor-Leste achieved 
independence were heightened when Australia granted temporary 
protection visas to 43 Papuan asylum seekers who landed on Cape 
York Peninsula in northeastern Australia in January 2006, a decision 
denounced by Jakarta in harsh terms. 

The victimization of Australians in the first Bali bombing in 2002 
and the Australian Embassy bombing in Jakarta in 2004 did not elicit 
substantial Indonesian public sympathy, although the Indonesian gov- 
ernment did allow for significant assistance by Australian crime 
investigators. Bilateral relations were particularly poor under Prime 
Minister John Howard because of his close relationship with President 
George W. Bush, illustrated by Howard's strong support for the war in 
Iraq and the persistent misperception that he had once stated that Aus- 
tralia was America's "deputy sheriff' in Asia. The implicit long-term 
Indonesian "threat," as it appeared in Australia's defense-planning 
documents, underlined a latent suspicion in Jakarta that Australian 
policy toward Indonesia was based on fear, not friendship. This per- 
ception had to be constantly allayed by official Australian visits to 
Jakarta, and it was the driving force behind the signing of a bilateral 
security pact in 2006 (see Foreign Military Relations, ch. 5). 

The Philippines 

The Philippines is a contiguous state and an ASEAN partner, yet 
Indonesia's relations with it are more distant than with its other imme- 
diate neighbors. The Philippines' aligned status with the United States 
and its territorial dispute with Malaysia over the sovereignly of Sabah 
inhibit a close relationship with Indonesia and other ASEAN members. 

Nonetheless, when President Ferdinand Marcos resigned in 1986, 
Jakarta joined other ASEAN states in welcoming a peaceful transfer 
of power to Corazon Aquino. Jakarta was the first capital visited by 
the Philippines' new president, unprecedentedly even before Wash- 
ington, and Suharto took the opportunity to press the urgency of 



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Government and Politics 



defeating the communist New People's Army in the Philippines. To 
show support for Aquino's government, Suharto insisted that the 1987 
ASEAN Manila Summit meeting go forward despite apprehensions in 
other ASEAN capitals about the security situation. Jakarta was not 
displeased that Aquino was succeeded in 1992 by Fidel Ramos, who, 
as chief of staff of the Armed Forces of the Philippines and later sec- 
retary of national defense, was well known to the Indonesian mili- 
tary's senior leadership. In more recent years, Indonesia has been 
concerned about chronic political instability in the Philippines under 
presidents Joseph Estrada and Gloria Macapagal- Arroyo. 

Most worrisome for Jakarta is the seeming inability of the Philip- 
pines to put an end to its internal wars. Indonesia viewed the growth 
of the New People's Army as destabilizing for the region. Moreover, 
the Muslim insurrection in the south of the Philippines has had impli- 
cations for global terrorism, regional territorial integrity, and Indone- 
sian Muslim politics. Post-September 11, 2001, revelations that 
Indonesian terrorists had trained in camps in Mindanao and regularly 
traveled between the Philippines and Indonesia have prompted 
greater security cooperation between the two countries, although 
Indonesia was uncomfortable with the George W. Bush administra- 
tion's designation of Southeast Asia as the "second front in the global 
war on terrorism" and with the U.S. military's significant engagement 
in Mindanao as a result. 

Relations with East Asia 

China 

Bilateral relations between Indonesia and China have warmed con- 
siderably since the resumption of diplomatic ties in 1990, although 
residual suspicion remains about China's ultimate security and eco- 
nomic goals in the region. Trade that once had to be transshipped 
through Singapore or Hong Kong has become direct and has increased 
exponentially. China has become an important market for Indonesia's 
natural gas and minerals. There have even been efforts to improve 
bilateral defense and security cooperation through direct military-to- 
military ties. Nonetheless, Indonesia has largely preferred to contain 
China's regional expansionism via ASEAN rather than bilaterally, by 
establishing forums such as ASEAN Plus Three in 1997 and support- 
ing China's accession to the TAC in 2003. 

Indonesia's diplomatic relations with China were suspended in 
1967 in the aftermath of the 1965 attempted coup d'etat. Beijing was 
suspected of complicity with the PKI in planning the coup and was 
viewed by the new military-dominated government as a threat 
through its possible support of a resurgent underground PKI, both 



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Indonesia: A Country Study 

directly and through a "fifth column" of Chinese Indonesians. Jakarta 
repeatedly demanded an explicit disavowal by Beijing of support for 
communist insurgents in Southeast Asia as its sine qua non for a nor- 
malization process. Underlying the Indonesian policy was unease 
about China's long-range goals in Southeast Asia. The break in rela- 
tions persisted until 1990, when, in the face of shifting global and 
regional realities as well as renewed mutual confidence, the two 
countries resumed their formal ties. An exchange of visits by Chinese 
premier Li Peng to Jakarta in August 1990 and by Suharto to Beijing 
in November 1 990 symbolized the dramatic alteration that had taken 
place. In particular, normalization was driven by four factors: China's 
market reforms had made it less threatening ideologically and more 
formidable as an economic force; the end of the Cold War had weak- 
ened the Soviet Union and thus strengthened China's regional posi- 
tion; Indonesia's deep involvement in the Cambodian peace process 
was hampered by a lack of direct relations with the Khmer Rouge's 
main sponsor; and Indonesia's desire to mediate the South China Sea 
disputes was similarly hampered in the absence of direct relations 
with the largest party to the disputes. 

Japan 

The quality of Indonesia-Japan relations is best measured by statis- 
tics on trade, investment, and the flow of assistance. In 2008 Japan 
was the single-largest destination of Indonesia's exports, the second- 
largest source (after China) of its imports, the single-largest foreign 
investor, and by far the most important donor of development assis- 
tance (see The Changing Nature of Trade and Aid, ch. 3). In return, as 
the dominant foreign economic presence in Indonesia, Japan is subject 
to all the expectations and resentments attendant on that status, for 
example, Indonesia has sought greater technology transfer as part of 
Japanese investment. The association of Japanese firms with politi- 
cally well-connected Indonesians has led to charges of exploitation. 
With their memories of World War II and the anti- Japanese demon- 
strations during Prime Minister Tanaka Kakuei's 1974 visit, the Indo- 
nesian leadership was keenly sensitive to the possibility of a disruptive 
anti-Japanese backlash (see Rise of the New Order, 1966-98, ch. 1). 
However, the issues of Japan's version of World War II history and of 
comfort women, so critical to its relations with China and South 
Korea, do not weigh as heavily in the relationship with Indonesia. 

In the long term, the critical issue for Indonesia in the early 
twenty-first century is access to Japan's markets for manufactured 
goods. Yet, Indonesia shares the ASEAN- wide concern about the 
implications for Southeast Asia of Japanese remilitarization and was 



302 



Government and Politics 



ambivalent about Japanese military participation in UN peacekeep- 
ing operations in Cambodia. From Tokyo's point of view, there is 
only an indirect linkage between Japan's economic presence and the 
political relationship between the two countries, but Japan is aware 
of Indonesia's geostrategic straddling of the main commercial routes 
to the Middle East and Europe. In addition, Japan struggles in Indo- 
nesia, as elsewhere in the region and the world, to compete with a 
resurgent China. 

Relations with the United States 

Indonesian relations with the United States are in some respects 
the warmest they have ever been. Ironically, this rapport came at a 
time when Southeast Asia as a whole, including Indonesia, had 
dropped significantly in terms of U.S. global priorities. The funda- 
mental underpinning of the warm relations is Indonesia's successful 
transition to democracy. Not only do the two countries now share a 
political system and political values, but also human-rights violations 
and restrictions on bilateral military ties have become a much less 
prominent impediment to good relations. It has certainly also helped 
that President Yudhoyono spent several stints in his military career 
obtaining training and education in the United States, including at 
Fort Benning in 1975 and 1982 and at Fort Leavenworth in 1990-91, 
during which time he earned a master's degree in management from 
Webster University, which has a campus at Fort Leavenworth. The 
2008 election as president of Barack H. Obama, who lived in Jakarta 
for several years as a child, has dramatically raised expectations of 
even closer ties with the United States. The importance of these ties 
to the Obama Administration was signaled in February 2009 by Sec- 
retary of State Hillary Clinton's addition of Indonesia to the Northeast 
Asian itinerary of her first overseas trip. 

To the extent Indonesia was a priority for the United States under 
the George W. Bush administration, it was primarily through a security 
lens. This focus included counterterrorism, maritime security, Indone- 
sia's utility as a voice for moderation in the Muslim world, and nontra- 
ditional security threats such as avian influenza. The 2002-5 bombings 
in Jakarta and Bali drove home for both Indonesia and the United 
States that international terrorism is a significant problem in Southeast 
Asia. Indonesian security forces, particularly the police, provided 
unprecedented access to American investigators and trainers, resulting 
in the killing or capture and conviction of hundreds of militants. Mari- 
time security mainly focuses on the Strait of Malacca, where the 
emphasis is on piracy and international shipping, and on the Sulawesi- 
Sulu corridor, where the focus is on counterterrorism. The United 



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Indonesia: A Country Study 

States also appreciated Indonesian support in March 2007 for UN 
Security Council Resolution 1747 on Iran's nuclear- weapons program. 

Indonesia, for its part, resented the narrow focus of American inter- 
est in it. Indonesia certainly shares many of these security concerns, 
but its interests in the bilateral relationship are much broader, includ- 
ing reviving military ties, increasing trade and investment, addressing 
climate change, and expanding access to American educational insti- 
tutions for Indonesian postsecondary students. Under rules known as 
the Leahy Amendment, the U.S. Congress totally cut off bilateral mil- 
itary sales and assistance following the violence accompanying the 
East Timor referendum in 1999. This cutoff expanded restrictions put 
in place after the 1991 Santa Cruz Massacre in Dili. Indonesia has 
made the case that these sanctions are anachronistic given its transition 
to democracy. The George W. Bush administration began to reestab- 
lish the military relationship, but the U.S. Congress continues to back 
some restrictions in response to pressure from human-rights groups 
(see Post-Suharto Reforms, ch. 5). Indonesia's interests in a broader 
bilateral relationship were given concrete form in President Yud- 
hoyono's proposal for a "comprehensive partnership" in a November 
2008 speech at the United States-Indonesia Society (USINDO) in 
Washington, DC. The emphasis of this partnership would not be on 
U.S. assistance to Indonesia, which would nonetheless continue, but 
rather on global and regional issues that the two countries could help 
solve together. The Obama administration, while maintaining the sig- 
nificant levels of security cooperation established under the Bush 
administration, welcomed this initiative by proposing that, in addition 
to existing security concerns, the partnership should focus on energy, 
the environment, and climate change; economic, trade, and investment 
cooperation; democracy and good governance; education; and health. 

The United States is the second-largest destination (after Japan) of 
Indonesia's exports, and the third-largest source (after China and 
Japan) of its imports. American investment in Indonesia's oil, gas, 
and mining sectors is significant but remains quite low in other sec- 
tors as a result of American companies' concerns about corruption, 
low labor productivity, an inflexible labor law, and uncertain con- 
tract enforcement. Indonesia has assumed global leadership on envi- 
ronmental issues by hosting the UN Climate Change Conference in 
Bali in December 2007 and has continued to press the United States 
on this issue. Finally, after the September 11, 2001, terrorist attacks 
on the United States, Washington tightened its visa policies, making 
it much harder for foreign students wishing to study in America, par- 
ticularly from Muslim-majority countries such as Indonesia. This 
change, combined with the slow decline over several decades in 



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Government and Politics 



American scholarships for foreign students, has made it much more 
difficult for Indonesians to access U.S. institutions of higher learn- 
ing. Indonesia places a high priority on education as a means to spur 
its development, and the United States remains a favorite destination 
for Indonesian students. All of these issues are important to resolve 
in further improving the bilateral relationship, but none has yet been 
a serious impediment to the increasingly warm connection. 

Consolidating Democracy, Contributing to 
Global Peace 

Indonesia has made substantial progress toward democratization 
since 1998. It has successfully navigated a transition to democracy, 
minimizing the military's direct political influence, amending the 
constitution, holding multiple credible elections, and embarking on an 
unprecedented decentralization of power. It is also making significant 
progress in consolidating this new democracy, and the 2009 election 
cycle was another significant milestone in this regard. Addressing 
corruption, improving economic performance, strengthening local 
governance, and fixing the judicial system will also contribute to 
democratic consolidation. Indonesia has rebounded from the depths 
of the 1997-98 Asian financial crisis, but its growth rates need to be 
higher in order to reduce poverty and make the leap to the next level 
of development. A stable democracy and a prosperous economy 
would provide Indonesia with strong foundations for its dream of 
playing a middle-power role regionally and even globally in some 
interest areas. Its peacekeeping role in Lebanon in 2007, as well as its 
offers to help address conflicts in the Korean Peninsula, Burma, Iran, 
and Iraq, are emblematic of the constructive role Indonesia envisions 
for itself in a post-Cold War, post-September 1 1 world. 

* * * 

Useful general surveys of contemporary Indonesian politics include 
Ross H. McLeod and Andrew Maclntyre's Indonesia: Democracy and 
the Promise of Good Governance', John Bresnan's Indonesia: The 
Great Transition', and Donald K. Emmerson's Indonesia Beyond 
Suharto: Polity, Economy, Society, Transition. Blair A. King analyzes 
constitutional reform in "Empowering the Presidency: Interests and 
Perceptions in Indonesia's Constitutional Reforms, 1999-2002." Mili- 
tary reform is addressed in John B. Haseman and Eduardo Lachica's 
two works: Toward a Stronger U.S. -Indonesia Security Relationship 
and The U.S. -Indonesia Security Relationship: The Next Steps as well 



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Indonesia: A Country Study 

as in Marcus Mietzner's The Politics of Military Reform in Post- 
Suharto Indonesia: Elite Conflict, Nationalism, and Institutional 
Resistance and Dewi Fortuna Anwar's Negotiating and Consolidating 
Democratic Civilian Control of the Indonesian Military. Andrew 
Maclntyre's The Power of Institutions: Political Architecture and Gov- 
ernance offers contemporary analyses of Indonesia's political econ- 
omy, as does Chris Manning and Peter Van Diermen's Indonesia in 
Transition: Social Aspects ofReformasi and Crisis. 

Decentralization is the subject of many studies, such as Henk 
Schulte Nordholt and Gerry van Klinken's Renegotiating Boundar- 
ies: Local Politics in Post-Suharto Indonesia. East Timor's achieve- 
ment of independence is analyzed by Richard Tanter, Gerry van 
Klinken, and Desmond Ball in Masters of Terror: Indonesia s Mili- 
tary and Violence in East Timor. Edward Aspinall studies the Aceh 
peace process in Helsinki Agreement: A More Promising Basis for 
Peace in Aceh? Blair A. King's Peace in Papua: Widening a Window 
of Opportunity addresses the challenges of resolving separatism and 
poor governance in Papua. The communal violence that has plagued 
Indonesia is the subject of Jacques Bertrand's Nationalism and Ethnic 
Conflict in Indonesia and Gerry van Klinken's Communal Violence 
and Democratization in Indonesia: Small Town Wars. 

Political Islam is also the subject of numerous studies, such as 
Bahtiar Effendy's Islam and the State in Indonesia, Robert W. Hefner's 
Civil Islam: Muslims and Democratization in Indonesia, Zachary 
Abuza's Political Islam and Violence in Indonesia, and Azyumardi 
Azra's Indonesia, Islam, and Democracy: Dynamics in a Global Con- 
text. R. William Liddle gives a succinct overview of Indonesian political 
culture in Politics and Culture in Indonesia. Mikaela Nyman considers 
contemporary developments in Indonesian civil society in Democratis- 
ing Indonesia: The Challenges of Civil Society in the Era of Reformasi. 

Indonesian foreign policy and regional implications are analyzed in 
Dewi Fortuna Anwar and Harold A. Crouch's Indonesia: Foreign Pol- 
icy and Domestic Politics, Angel Rabasa and Peter Chalk's Indone- 
sia 's Transformation and the Stability of Southeast Asia, and Anthony 
L. Smith's Strategic Centrality: Indonesia 's Changing Role in ASEAN. 

Gerald L. Houseman's Researching Indonesia: A Guide to Political 
Analysis is an overall guide to the analysis of Indonesian politics. 
Annual surveys of Indonesian political events can be found in the Jan- 
uary-February issue of Asian Survey and the annual Southeast Asian 
Affairs (Singapore). For current politics, the Asian Wall Street Journal 
(Hong Kong) and the Far Eastern Economic Review (Hong Kong) are 
extremely useful. The Indonesian government also offers a variety of 
Web sites, many of which are listed on http://indonesia.go.id/en. (For 
further information and complete citations, see Bibliography.) 



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Chapter 5. National Security 




PC-40 type fast patrol craft underway 



INDONESIA'S MILITARY AND NATIONAL POLICE have under- 
gone important changes since the Suharto era ended in 1998; how- 
ever, they retain a role in national society that is perhaps unique in 
the world. Historically, the Indonesian military has been involved in 
many affairs of state that elsewhere are not normally associated with 
the armed forces. Since the Netherlands recognized Indonesian sov- 
ereignty in 1949, the military has been the dominant political institu- 
tion in Indonesia. In comparison with the armed forces of nations of 
comparable background and state of development, the Indonesian 
military is cautious in its exercise of traditional military authority 
over society. However, until discarded in 1999, its doctrine of 
dwifungsi (dual function) gave the military a role in virtually every 
aspect of civil society, from village-level politics through the full 
spectrum of security and intelligence missions. This legacy has been 
a major factor in the military's effort to define its role in the course of 
the nation's transition from autocracy to democracy in the post- 
Suharto era. 

From Suharto's assumption of power in 1966 to his forced retire- 
ment 32 years later, the armed forces accepted and supported the ratio- 
nale behind his regime, namely, that economic and social development 
was the nation's first priority and that social and political stability was 
absolutely essential if that goal were to be achieved. Regime protection 
and maintenance of internal stability were the primary missions of the 
Indonesian National Armed Forces (see Glossary). The armed forces 
are currently called Tentara Nasional Indonesia (TNI but earlier ABRI; 
for these and other acronyms, see Table A). They were eminently suc- 
cessful in this regard, leading the nation out of a period of political and 
social upheaval in the mid-1960s into a period of relatively long-lasting 
domestic order and unprecedented economic growth. The price paid by 
society was tight control of the citizenry, intolerance of criticism or 
other forms of opposition to the regime, and heavy censorship of the 
news media. 

Suharto's resignation from the presidency in May 1998 came 
amid a combination of regional economic recession and popular dis- 
content. The long-serving president's removal gathered even greater 
impetus from his inattentiveness to outbreaks of violence concen- 
trated mainly in Jakarta, and from the popular perception that he and 
his family were involved in corrupt activities. The armed forces 
establishment, Suharto's primary instrument of political control for 
more than three decades, was also a crucial element in his fall from 



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Indonesia: A Country Study 

power. The military leadership declined to take control of the gov- 
ernment to keep Suharto in office and acted with restraint while 
overseeing a constitutional transfer of leadership to his vice presi- 
dent, Bacharuddin J. (B. J.) Habibie. Many analysts felt at the time 
that the ambitious commander in chief of the armed forces, General 
Wiranto, believed that Habibie would resign along with Suharto and 
that he himself would be asked to take the presidency in a move 
eerily similar to Suharto's own accession to power in 1966. In many 
subsequent public interviews, Wiranto said that he had been asked 
twice by Suharto to take power but had declined to do so. Wiranto 
subsequently was credited with supporting the constitutional change 
of leadership. 

The fall of Suharto prompted a reconsideration of the military's role 
in government and society over the long period of his rule. A free 
press and a newly empowered national legislature — the People's Con- 
sultative Assembly (MPR) — focused on abuses by the military during 
the Suharto years. Revelations of human-rights abuses, improper use 
of power, corruption, economic intimidation, and other unprofessional 
conduct caused the military acute embarrassment and loss of prestige. 
But the years immediately following Suharto's fall brought disorga- 
nized civilian government, widening corruption, and, in a number of 
different parts of the country, religious and ethnic violence on a scale 
not seen for a generation. The apparent inability of the civilian admin- 
istration to impose order on society, combined with widespread yearn- 
ing for the stability that had characterized most of the Suharto era, 
resulted in popular demands for a more effective and decisive govern- 
ment. By assuming a lower profile and engaging in a series of reforms, 
the military regained much of its lost stature. Furthermore, it remained 
the most organized and disciplined element of Indonesian society. 

Throughout the Suharto years, the central government had provided 
insufficient funding for the military, with only about one-third of its 
administrative and operational costs covered by the defense budget. 
The rest of the military's financial requirements were met by receipts 
from its extensive business empire or diversions from other govern- 
ment institutions. But the 1997-98 financial crisis, compounded by 
arms embargoes imposed by Indonesia's traditional military suppliers, 
had an immediate effect on force readiness. Within a few years, the 
armed forces' primary weapons systems had deteriorated as a result of 
lack of maintenance and an inability to purchase spare parts for major 
systems. International reaction to human-rights violations perpetrated 
during the 1990s in East Timor (Timor Timur Province; since May 20, 
2002, the independent Democratic Republic of Timor-Leste) had par- 
ticularly severe consequences, prompting the United States and other 



310 



National Security 



nations to embargo arms sales and military training. Indonesia conse- 
quently turned to nontraditional suppliers, primarily in Eastern Europe 
and Asia, to upgrade its aging ground, air, and naval systems. Even so, 
the deterioration of the TNI's capabilities was demonstrated by the 
military's deficient performance in the aftermath of the December 26, 
2004, tsunami that devastated the coast of the Special Region of Aceh 
(called Nanggroe Aceh Darussalam, 1999-2000, in an effort to 
assuage separatist sentiment in the region). Although the TNI's per- 
sonnel performed very well on the ground, where the large military 
presence turned largely from combat to recovery efforts and other 
forms of civic action, its air-transport systems were woefully unpre- 
pared to confront such a massive natural disaster. That outcome, along 
with the visible deterioration of the TNI's capabilities, figured heavily 
in the U.S.. decision to reestablish military ties with Indonesia. 

The inauguration in October 2004 of Susilo Bambang Yudhoyono 
as Indonesia's sixth president, and the fourth since the fall of Suharto, 
came at an important juncture for Indonesia's national-security pos- 
ture. The election of a retired general by a majority of more than 60 
percent of the votes cast reflected not only respect for him as a leader 
perceived to be free of corruption, but also a yearning for a more 
focused and active government. President Yudhoyono benefited from 
his reputation as a "thinking general," who supported reform of the 
military and whose independence from preceding administrations 
appealed to an electorate weary of continued corruption, inefficiency, 
and generally uninspired government. 

The biggest challenge facing Yudhoyono as he began his adminis- 
tration may have been to meet excessive popular expectations while 
showing competence with the practical matters of government. The 
national leadership would have to address the issues of economic 
growth and political change in a security environment made more 
tenuous by the threat of international and domestic terrorism, as well 
as by long-standing separatist rebellions at its eastern and western 
extremes, Papua Province and the Special Region of Aceh. With its 
transition to democracy reinforced by peaceful and honest legislative 
and presidential elections, Indonesia still had to address the signifi- 
cant domestic security issues of separatism; sectarian and ethnic vio- 
lence and its causes; and Islamic extremism, the effect of which was 
to help sustain international terrorism. 



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Indonesia: A Country Study 



Historical Context 

Independence and the Sukarno Period, 1945-65 

The Indonesian armed forces grew out of the diverse experience of 
the Dutch colonial period (the early seventeenth through the early 
twentieth centuries), the Japanese occupation (1942^45) during 
World War II, and the struggle for independence (1945^9). During 
the colonial period, a small number of Indonesians were recruited 
into the Royal Netherlands Indies Army (KNIL). Subsequently, Japa- 
nese occupation forces recruited Indonesians, often former KNIL sol- 
diers, for use as military auxiliaries {heiho) and as supply and support 
personnel attached to the Japanese army. These Indonesian enlisted 
personnel frequently were sent to the front in the Pacific, the Philip- 
pines, and other war zones, such as Burma. The deteriorating military 
situation in 1943 led the Japanese occupation authorities to organize 
an indigenous volunteer self-defense force called the Defenders of 
the Fatherland (Peta). In Java some 37,000 Peta recruits, including 
officers, received training in combat tactics. The number of such 
troops trained in Sumatra, where the forces were usually known by 
their Japanese name — Giyugun (volunteer army) — is unknown, but 
knowledgeable sources estimate about one-third of the number 
trained for Java's Peta. 

Along with former heiho and KNIL troops, Peta provided the 
emergent Indonesian state with a ready source of trained military per- 
sonnel following Japan's defeat in 1945. This force was supple- 
mented by large numbers of young people with experience in various 
paramilitary youth corps that had been organized by the Japanese; 
they mobilized the population and provided a recruiting base for Peta. 

An embryonic military organization, with these elements as its 
nucleus, the People's Security Forces (BKR), was formed on August 
22, 1945. Just five days earlier, on August 17, Sukarno and Moham- 
mad Hatta had proclaimed Indonesian independence. Thousands of 
members of various local militias (laskar) also joined the newly con- 
solidated national armed forces. From the beginning, the Western 
ideal of a politically neutral military had few proponents. Many of 
those who joined the new force, called the Indonesian National 
Armed Forces (TNI) from 1947 to 1962 (also APRIS— Armed 
Forces of the Federal Republic of Indonesia — from 1949 to 1950 
and APR! — Armed Forces of the Republic of Indonesia — in 1950), 
were nationalists who sought both military victory and political 
change for their nation. 

The disparate forces fought a largely guerrilla-style war against the 
returning Dutch troops. Commanded by the young and charismatic 



312 




General Sudirman, the newly formed army avoided entrapment and 
fought on even after the Dutch forces captured Sukarno and the civil- 
ian government at Yogyakarta. Sudirman, Indonesia's youngest-ever 
general, was the first commander in chief of Indonesia's armed 
forces. He led the army in battle from 1945 to 1949 even though he 
suffered from tuberculosis and had to be carried from place to place 
in a modified palanquin. He remained in command until his death in 
January 1950 at the age of 35. Sudirman has been honored as the 
founding father of the Indonesian military ever since, a national hero 
whose spirit and nationalism are invoked as key ingredients of the 
Indonesian military ethos. 

Experiences during the armed struggle against the Dutch strength- 
ened the military's political involvement in national affairs. Faced 
with better-trained and better-equipped Dutch forces, the Indone- 
sians conducted a guerrilla war in which fighters had to rely heavily 
on the support of the local population. This tie to the populace rein- 
forced the concept of perjuangan (the struggle), which stressed reli- 
ance on the people for support, intelligence, and succor against both 
external threats and internal divisiveness. This concept was at the 
heart of army chief of staff and former KNIL soldier General Abdul 
Haris Nasution's ideas about guerrilla warfare or total people's war. 
Dwifungsi, later used by Suharto to justify his use of the armed 
forces as the primary pillar of support of his lengthy rule, referred to 
the military's right, drawn from the revolutionary experience, to fill 
both military and civilian political and civil roles in society. 

An attempt by the Indonesian Communist Party (PKI) to seize 
power at Madiun, East Java, in September 1948 turned the military 
against the communist movement. Considered a treasonous and 



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Indonesia: A Country Study 

treacherous betrayal because it occurred during the independence 
struggle against the Dutch, the incident — commonly called the Madiun 
Affair — caused a deep and permanent suspicion within the military, 
not only of communism but of leftist movements in general. 

At the end of the independence war in 1949, the government had 
as many as 500,000 armed fighters potentially at its disposal. Demo- 
bilization reduced this number to 200,000 by mid- 1950, when the 
military was officially designated the Armed Forces of the Republic 
of Indonesia (APRI). The first priority of the military leadership was 
to form some semblance of a unified structure from numerous dispa- 
rate elements — many of them loyal to local leaders and regional 
power holders — and to establish central control over these elements. 
General Nasution made progress in this direction, overseeing the 
restructuring of operational units in all three military services, in 
accordance with organizational charts borrowed from Western armed 
forces, and instituting formal training programs. Similar changes 
occurred in the structure of the National Police of Indonesia (Polri). 

After 1955, Nasution initiated a series of personnel transfers and 
instituted several reforms to gain control over local commanders. 
Between 1950 and 1958, several opponents of Nasution's policies 
joined local rebellions in the Outer Islands (see Glossary; The Road 
to Guided Democracy, 1957- 65, ch. 1). Any one of these disparate 
movements, such as the Universal Struggle (Permesta) rebellion in 
central and western Sumatra and Sulawesi, the Darul Islam (House 
of Islam) rebellion in western Java, and the establishment of the 
short-lived Republic of South Maluku (RMS), could have fatally 
splintered the young republic, had it succeeded. Deploying to the 
rebellious regions, the army overcame these various uprisings, its 
members often fighting against former comrades. These operations 
were another national success cited by the armed forces in justifying 
a leadership role in national affairs. 

The armed forces' position in the government became institution- 
alized during the period of Sukarno's Guided Democracy (1957-65). 
Vowing that it would neither be a "dead tool of the government" nor 
assume total control of the nation, the military took what General 
Nasution referred to as the "middle way," working cooperatively 
with the civilian leadership through its representation in the cabinet, 
the MPR, and the civil service. The services became, along with the 
PKI, a "junior partner" to Sukarno in ruling the nation. Uniformed 
personnel held positions throughout the nation down to the village 
level, in both the administration of martial law and the management 
of economic enterprises (mostly nationalized former Dutch proper- 
ties), and in the deployment of regional cadre units assigned to 
mobilize local resistance in the event of a threat to national security. 



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National Security 



To support the activist foreign policy of the Guided Democracy 
period, especially the 1962 campaign against Dutch forces in West 
New Guinea (also called West Irian or Irian Barat, and renamed Irian 
Jaya — Victorious Irian — in 1972 by the national government; now 
called Papua and Papua Barat) and the 1963-66 armed Confronta- 
tion (see Glossary), or Konfrontasi, with Malaysia, Sukarno rapidly 
enlarged the armed forces (see Relations with Neighboring Nations, 
ch. 4). Most affected were the formerly tiny air force and navy, 
which greatly expanded and acquired advanced arms and equipment 
by means of military credits from the Soviet Union and the Soviet- 
bloc states of Eastern Europe. By the mid-1960s, Indonesia had one 
of the largest and best-equipped armed forces in Southeast Asia. 

Trying to contain the army's expanding political influence in the 
early 1960s, Sukarno encouraged the air force, navy, and police (the 
latter was a fourth branch of the armed forces until 1999) to act inde- 
pendently of the army. The army leadership became alarmed by the 
resulting divisions among the services, the growing influence of the 
PKI in all four branches, and Sukarno's increasing support for the 
PKI. Tension within the armed forces increased following proposals 
by the PKI in early 1965 to place political advisers in each military 
unit (as in the Chinese and Soviet systems) and to establish a "fifth 
force" of armed peasants and workers outside the control of the 
existing armed services. 

Suharto's New Order, 1966-98 

An attempted coup d'etat on the last day of September 1965 by 
alleged communist sympathizers in the military — the September 30 
Movement (Gestapu) — was the seminal event in the evolution of the 
modern Indonesian armed forces. The details of the event remain 
clouded and controversial even as post- Suharto research continues. The 
accepted government version is that General Suharto, at the time not 
widely regarded as part of the most powerful senior military elite, orga- 
nized quick and effective resistance to a PKI-organized attempted 
coup. The precise nature and significance of his role in this crucial 
affair remain matters of considerable debate, but whatever the truth, 
Suharto rose rapidly to a position of paramount national power. 
Sukarno was obliged to relinquish de facto authority to Suharto in 
March 1966, and Suharto was appointed acting president one year later. 
Along with unrestrained violence, in which hundreds of thousands of 
civilians died, and a subsequent wave of arrests, the coup attempt led to 
the suppression of the PKI. The expansionist military doctrine of the 
Sukarno era was ended, and national expenditures began to be focused 
on economic development. 



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Indonesia: A Country Study 

The military establishment, led by the army, has been the coun- 
try's premier institution since 1966, when, in its own view, it 
answered the summons of the people and moved to center stage. 
Comprising the three military services and the police, the armed 
forces operated according to the dwifungsi doctrine, enacted into law 
in 1982, which gave the military a dual role — traditional responsibil- 
ity as defenders of the nation, plus duty as a sociopolitical force pro- 
moting stability, order, and national development. Under this very 
broad charter, active-duty and retired military personnel were 
assigned throughout the gdvernment to posts filled in most other 
countries by civil servants or politically appointed civilians. Military 
personnel most frequently received postings as provincial governors, 
district heads, members of legislative bodies, functionaries in a vari- 
ety of civilian governmental departments, and ambassadors. The 
armed forces became a dominant factor in the social — including 
even sports and entertainment — and political life of the country and 
acted as a major executive agent of government policies. 

To understand fully the role of the armed forces in contemporary 
Indonesian society, one must understand the absolute priority the 
government and the military leadership gave to internal security and 
national stability during the New Order (1966-98). Having experi- 
enced attempted coups in 1948 and 1965, which they identified as 
communist-inspired, as well as a number of regional separatist strug- 
gles and instability created by radical religious movements, the New 
Order government had little tolerance for public disorder. 

The Suharto government brought the nation unprecedented stabil- 
ity, remaining in firm control and without serious challenge from 
1966 to 1998. The leadership remained alert to real or potential sub- 
versive threats, maintaining surveillance — and sometimes control — 
over the activities and programs of a wide range of groups and insti- 
tutions. The government was acutely sensitive to any signs of oppo- 
sition to its policies. In general, it seemed to label as subversive 
anything not supportive of the national ideology, the Pancasila (see 
Glossary; Pancasila: The State Ideology, ch. 4). The extent of change 
in the years after the fall of Suharto can be fully realized only by 
comparing that environment of close control of society and repres- 
sion of dissent with the openness experienced in the period after 
1998, with its robust free news media and aggressive debate in the 
national legislature. 

Separatist insurgencies have long been the most serious threat to 
national security. The Suharto government referred to such insurgent 
activity as a Security Disturbance Movement (GPK). Three such 
movements, the Revolutionary Front for an Independent East Timor 



316 



National Security 



(Fretilin — see Glossary) in Timor Timur Province, the Free Aceh 
Movement (GAM) in Aceh, and the Free Papua Organization (OPM) 
in Papua Province, have important roles in the nation's modern secu- 
rity history (see Post-Suharto Reforms, this ch.). 

Groups advocating the establishment of an Islamic state, either 
over the whole national territory or over discrete areas, were an occa- 
sional security threat in the 1970s and 1980s. Such organizations as 
Darul Islam, Bangsa Islam Indonesia (Indonesian Nation of Islam), 
and Komando Jihad (Commando Jihad) carried out insurgency and 
terrorist operations against the secular state. Komando Jihad was held 
responsible for bombings of churches and theaters in 1976 and 1977, 
attacks on police stations in 1980 and 1981, and the 1981 hijacking to 
Bangkok of a<}aruda Indonesia domestic flight. 

During the 1980s, Indonesia's rapid economic development — 
with annual growth rates approaching 9 percent — caused social pres- 
sures on society that brought new domestic tensions. These changes, 
including improved educational opportunities, rising expectations, 
industrialization, unemployment, and crowded cities, were blamed 
for generating urban crime, student and political activism, and labor 
strikes. One example of government action to address these issues 
occurred in the early 1980s, when an alarming rise in violent crime 
in Jakarta and other large cities on Java prompted the notorious 
undercover "Petrus" {penembakan misterius — mysterious shoot- 
ings — or pembunuhan misterius — mysterious killings) campaign, in 
which known criminals were killed by handpicked execution squads 
and their bodies dumped in public places as a warning. Despite the 
number of killings, which human-rights groups estimated at 6,000 to 
8,000 nationwide, most of the public expressed cautious approval of 
the Petrus campaign, usually accompanied by criticism of the police 
for being unable to stop the rise in crime. 

Government operations had driven extremist groups underground 
by the early 1990s. Interestingly, some of these groups had eked out 
an existence for decades, undercover and largely through family 
connections and generational transfers, before reemerging in the late 
1990s as a recruiting base for resurgent domestic and international 
terrorist organizations (see Terrorism, this ch.). 

Violent ethnic disputes generally were kept to a minimum during 
the Suharto years because of the assurance of a quick and brutal 
response by security forces. Most such outbreaks were directed against 
Indonesians of Chinese descent. The nation's ethnic Chinese minority, 
estimated at 4 million or more in the early twenty-first century, has 
evoked popular resentment since the colonial era, when Chinese indi- 
viduals often served as business intermediaries between the Dutch elite 



317 



Indonesia: A Country Study 

and the indigenous population (see Ethnic Minorities, ch. 2). In the 
modern period, resentment has continued over Chinese Indonesians' 
wealth and domination of the economy, including their roles as inter- 
mediaries for foreign investors and as advisers and silent partners for 
senior armed forces personnel and civilian government leaders with 
business interests. These ethnic Chinese businesspeople, known as 
cukong (see Glossary), were particularly important in the Suharto fam- 
ily's increasingly rapacious commercial arrangements. 

Anti-Chinese feeling surfaced violently in the turmoil immedi- 
ately preceding Suharto's May 1998 resignation, when large num- 
bers of ethnic Chinese homes and businesses were destroyed, and 
dozens of ethnic Chinese women were raped by mobs of rioters. The 
violence caused a major flight of ethnic Chinese capital from Indo- 
nesia, which worsened the economic depression that started in 1997. 
The continued slow repatriation of that capital remains an important 
reason for Indonesia's delayed economic recovery (see Postcrisis 
Reform, ch. 3). 

The absence of a perceived external threat has been widely cred- 
ited with allowing Indonesia to concentrate on its internal defense 
and national development priorities. Successive armed forces com- 
manders stressed military readiness and training even as economic 
realities constrained new equipment purchases. Until 2007, when 
new armored personnel carriers were purchased from France to sup- 
port Indonesia's United Nations (UN) deployment to Lebanon, the 
only major acquisition for the ground forces was the 1981 purchase, 
through the U.S. Foreign Military Sales (FMS) program, of new 105- 
millimeter towed howitzers. New acquisitions for the other services 
during the late 1970s and early 1980s included F-5 fighter and A-4 
ground-attack aircraft for the air force and used, but still serviceable, 
ships for the navy. Twelve F-16 fighters, also purchased from the 
United States, were not delivered until 1989. Over the years, the 
armed forces had been seriously weakened by national spending pri- 
orities that stressed economic development and relegated defense 
spending to a much lower priority than in most developing nations. 
The low priority given to defense spending continued into the early 
years of the twenty-first century. This situation has compromised the 
military's readiness posture even further, because income from the 
military business empire is far less than in the past, as a result of the 
1 990s regional recession, corruption, and inept management (see Par- 
ticipation in the Economy, this ch.). In 2008, for example, the lower 
house of the national legislature, the People's Representative Council 
(DPR), provided the TNI and Department of Defense (Dephan) with 
less than one-third of the funding requested. 



318 



National Security 



Suharto deliberately underfunded the military for several reasons. 
First, national development claimed first priority for funding. Second, 
there was, realistically, no external threat to Indonesia's security and 
thus no need for top-of-the-line military arms. Third, by requiring the 
military to rely on its extensive business empire for an estimated two- 
thirds of its operational and administrative requirements, Suharto 
encouraged off-budget income and expenditures and accepted the 
inevitable corruption as a way to ensure the loyally of the military 
through financial gain. The major disadvantage of this system was 
that it loosened the central government's control over the armed 
forces. A military that obtains two-thirds of its funding from its own 
resources is far less responsive to government control than a military 
establishment* fully funded by the central government. It is for this 
reason that proponents of military reform focused on the need to gain 
civilian governmental control over the military business empire (see 
Defense Spending and the Defense Industry, this ch.). 

Post-Suharto Reforms 

The military establishment was pilloried by both the press and the 
populace over a series of revelations of human-rights abuses that 
came out after the fall of Suharto in May 1998. Furthermore, the 
armed forces leadership had become disillusioned by years of 
demands by Suharto for unprofessional conduct, such as intervention 
in most aspects of civil society and tight control over every aspect of 
political activity. Indonesia's military leaders responded to these 
developments by embarking on a process of change. The armed 
forces assumed a lower political profile and began a revision of doc- 
trine to meet some — but by no means all — of the calls for reform. 
This process of change was a major part of national reformasi (see 
Glossary), and both the process and the pace of change became sub- 
jects of analysis and criticism (see The Political Process, ch. 4). 

The military introduced reforms in an attempt to meet the new 
demands of a democratic society. The National Police, which had 
been a coequal branch of the armed forces since 1960, was separated 
from the military in 1999 and placed under the president. The name 
of the military establishment was changed from Armed Forces of the 
Republic of Indonesia (ABRI) to Indonesian National Armed Forces 
(TNI). The name change signaled a change in focus by which the 
National Police took the country's internal security as its primary 
responsibility. The Department of Defense and Security (Hankam) 
was redesignated simply the Department of Defense (Dephan), a 
move that underscored how the military's primary mission had 
changed (see fig. 12). 



319 



Indonesia: A Country Study 



MINISTER OF 
DEFENSE 



SPECIAL 
ADVISERS 



INSPECTOR 
GENERAL 



DEFENSE 
STRATEGY 
DIRECTORATE 



DEFENSE 
PLANNING 
DIRECTORATE 



RESEARCH AND 
DEVELOPMENT 
AGENCY 



SECRETARY 
GENERAL 



DEFENSE 
POTENTIAL 
DIRECTORATE 



DEFENSE 
STRENGTH 
DIRECTORATE 



DEFENSE 
FACILITIES 
DIRECTORATE 



EDUCATION AND 
TRAINING 
AGENCY 



DATA AND 
INFORMATION 
CENTER 



FISCAL 
CENTER 



CODES 
CENTER 



CASUALTY 
REHABILITATION 
CENTER 



Figure 12. Organization of the Department of Defense, 2009 



The TNI leadership discarded dwifungsi and replaced it with a doc- 
trine called the New Paradigm (Paradigma Baru), which emphasized 
"leading from behind" rather than domination of the political process. 
Constitutional reforms eliminated the TNFs blocs of reserved seats in 
the national and local legislatures. The TNI redirected its primary mis- 
sion from internal security to external defense, although the DPR's 
passage of a new military law in 2004 granted the armed forces signif- 
icant responsibilities for counterterrorism and counterinsurgency, 
because of the inability of the understaffed and poorly trained police to 
meet these intense challenges to domestic security. 

In 1999 Indonesia took one of the initial steps toward democratic 
civilian control of the military when, for the first time since the 
1950s, President B. J. Habibie appointed a civilian academic — 
Yuwono Sudarsono — as minister of defense. Other civilians followed 
him in that post during the presidencies of Abdurrahman Wahid and 
Megawati Sukarnoputri. In 2004 President Susilo Bambang Yud- 
hoyono appointed Sudarsono as minister of defense a second time. 
Despite starting a trend of civilian ministers of defense, however, the 
TNI commander retained full command authority and remained 
directly responsible to the president. The DPR recognized the concept 
of civilian leadership of the armed forces, however, and it included 
this principle in the 2004 military law but did not specify when, or 



320 



National Security 



how, it would be implemented. Military officers now must resign 
from the armed forces before taking civilian government positions. 
The military withdrew from day-to-day politics and remained neutral 
in the legislative and presidential elections of 1999, 2004, and 2009. 

East Timor 

East Timor was a colony of Portugal for more than 350 years. The 
Portuguese first came to the island of Timor in the sixteenth century, 
finding sandalwood in considerable quantity. The colony was later 
made profitable by the introduction of coffee, which remains the 
island's principal crop. Portuguese traders, backed by small detach- 
ments of soldiers, quickly conquered or established relations with a 
number of small Timorese kingdoms. The Dutch arrived on the 
island in the early seventeenth century, and surrogates of the govern- 
ments of Portugal and the Netherlands competed for power and 
influence for 200 years. The partition of the island of Timor into 
Dutch and Portuguese colonies in 1859 laid the basis for economic 
and social hardship that lasted into the early twenty-first century. 

In 1974, after a liberal military coup d'etat in Lisbon, the Portuguese 
government withdrew from its overseas colonial empire. Concerned 
after the fall of Vietnam, Cambodia, and Laos to communist armies, 
Indonesia — as well as some other regional and international powers, 
especially Australia and the United States — feared that East Timor's 
leftist Fretilin, the dominant political power in East Timor, might pro- 
vide a haven for communist infiltration. Indonesia consequently engi- 
neered a formal request by four of the five East Timorese political 
parties for integration into Indonesia, known as the Balibo Declaration. 
On November 28, 1975, Fretilin declared East Timor's independence 
from Portugal; nine days later, Indonesia's armed forces launched a 
full-scale invasion, and East Timor was incorporated as Indonesia's 
twenty-seventh province. ABRI treated its military campaign against 
Fretilin guerrillas as an internal security operation, and the province 
was closed to the news media and foreign observers until 1988. 

The UN never recognized Indonesian sovereignty over the terri- 
tory, and Australia was the only country to formally recognize the 
integration of East Timor into Indonesia. The United States took a 
middle position that accepted the integration of East Timor into 
Indonesia but held that the Balibo Declaration and a subsequent "ref- 
erendum" were not legitimate. This political issue dogged Indonesia 
for years. Fretilin forces withdrew to the rugged mountains of the 
interior and waged guerrilla warfare against the Indonesian army. 
During the next 20 years, at least 100,000 and possibly as many as 
250,000 East Timorese died in combat or from disease and privation. 



321 



Indonesia: A Country Study 

The majority of East Timorese did not support integration. It 
quickly became apparent that discontent was far more widespread 
than the Indonesian government and armed forces acknowledged 
publicly. Although Indonesian military operations reduced Fretilin's 
strength to only several hundred armed partisans, the resistance 
movement was supported by what the armed forces termed the 
klandestin, a large clandestine apparatus that provided intelligence, 
shelter, food, and supplies. The Indonesian army was unable to sub- 
due the military force, even though over the years it killed or captured 
a succession of Fretilin military and political leaders. ABRI was 
never able to win the hearts and minds of the East Timorese people 
because of mutual mistrust and misunderstanding, and the persistent 
use of the military to force the civilian populace into submission. A 
series of major human-rights abuses and atrocities kept an interna- 
tional focus on East Timor. Western criticism increased as improved 
communications and access to the province revealed the extent of the 
army's violence against civilians. 

In November 1991, Indonesian soldiers killed between 50 and 250 
civilians and wounded others participating in a funeral procession at 
the Santa Cruz Cemetery in Dili, East Timor's capital. This incident 
proved to be the turning point that focused international opposition to 
Indonesian military operations in East Timor. In an effort to address 
the problem, the army implemented for the first time the principle of 
command responsibility. The respected armed forces commander in 
chief, General Edi Sudrajat, disciplined five levels in the military 
chain of command involved in the incident, including two generals — 
the highest ranking in the East Timor operations — and a number of 
field-grade officers. The platoon leaders involved were court mar- 
tialed and imprisoned. But both the military and the civilian govern- 
ment, apparently obeying orders from Suharto himself, persistently 
failed to give a full accounting of the number of civilians killed or the 
disposition of the remains of the dead. The attack at Santa Cruz Cem- 
etery, and the government's refusal to reveal the true number of civil- 
ians killed in the incident, led to a dramatic decline in military-to- 
military relations between the United States and Indonesia, including 
an end to the International Military Education and Training (IMET) 
Program for Indonesia. 

In January 1999, President Habibie proposed an expansive local 
autonomy package for East Timor. He added controversy to the issue 
by promising "separation" of East Timor if the people voted against 
his proposal. There followed a campaign of vicious intimidation by 
pro-Indonesian militia groups, supported by elements of the Indone- 
sian army, intended to persuade the populace to approve the auton- 



322 



National Security 



omy package. Despite the intense intimidation, however, on August 
30, 1999, the East Timorese voted against autonomy by a margin of 
78.5 percent to 21.5 percent, and thus began a process of transition 
toward independence. 

The violence worsened following the vote against autonomy. As 
they withdrew, pro-Indonesia militia forces, in many cases assisted by 
Indonesian troops, systematically destroyed most of the town centers 
and infrastructure of East Timor. Estimates vary, but militias and sol- 
diers may have killed more than 1,300 civilians and forced more than 
200,000 people across the border into Indonesian West Timor (Nusa 
Tenggara Timur Province). Violence was so widespread, and the Indo- 
nesian security forces so deeply involved, that worldwide pressure 
compelled Indonesia to accept the entry of an international body of 
armed peacekeepers. The International Force in East Timor (INTER- 
FET), led by Australian troops and recognized by the UN — although it 
was not designated as a UN force — restored order in East Timor. In 
October 1999, the MPR formally detached East Timor from Indone- 
sia. The next month, INTERFET turned over control to the UN Tran- 
sitional Administration in East Timor (UNTAET), which, along with 
the advisory Timorese National Council, ran the territory until inde- 
pendence — as the Democratic Republic of Timor-Leste — on May 20, 
2002. 

The egregious behavior of army-backed militias, and the unwill- 
ingness of armed forces commander in chief General Wiranto to 
accept any responsibility for it or to discipline those involved, 
caused Australia, Britain, the United States, and other nations to fur- 
ther limit military relations with Indonesia. The United States sus- 
pended arms sales, halted the few remaining education and training 
programs, and imposed political conditions on the restoration of mil- 
itary-to-military relations. Only after the December 2004 tsunami 
struck Aceh did the United States restore Indonesia's eligibility for 
IMET funding and allow the sale of spare parts for transport aircraft 
under Foreign Military Financing (FMF) beneficial pricing. 

Separatist Rebellions 

The primary threat to Indonesia's national security has been posed 
by separatist guerrilla insurgencies in East Timor, Aceh, and, to a 
lesser extent, Papua and by extremist and terrorist organizations. The 
separation of East Timor in 1999 removed what Indonesia's former 
foreign minister Ali Alatas once injudiciously described as "a pebble 
in Indonesia's shoe." The peaceful political settlement of the Aceh 
separatist insurgency ended a major security threat as well. Indone- 
sia's primary security threat is now posed by Islamic extremist and 



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Indonesia: A Country Study 

terrorist organizations opposed to the moderate secular government 
system in Indonesia. Jemaah Islamiyah (Congregation of Islam), a 
regional terrorist organization with links to Al Qaeda, whose goal is 
to create a Muslim state in Southeast Asia, has conducted several ter- 
rorist attacks around the country and has been deeply involved in 
communal violence in Maluku and Sulawesi Tengah provinces. 

Aceh 

Aceh, on the northern end of the island of Sumatra, was for 
decades the most troubled and insecure province of Indonesia, with a 
history of opposition to outside rule from its time as an independent 
sultanate. Acehnese maintained a broad range of grievances against 
the central government that included a desire to keep a greater per- 
centage of the revenue from the rich natural resources in the prov- 
ince, resentment over brutal tactics by police and military forces, and 
a desire for more native Acehnese to be employed in the lucrative 
natural resources sector. 

A small minority of Acehnese have demanded independence. The 
separatist Free Aceh Movement (GAM) began guerrilla warfare in 
Aceh in the mid-1970s. Its political and military wings were distinct. 
A succession of GAM military commanders had given allegiance to 
the GAM's political leader, Hasan di Tiro, a longtime refugee in 
Sweden. However, years of separation and the resentment caused by 
the relative safety of political leaders in Europe while GAM person- 
nel in Aceh faced daily danger, led to a split that persists to this day. 
Attacks on public facilities and transportation, reprisal operations by 
both sides, and a lack of skill in combating insurgency on the part of 
the military and the police contributed to a high level of noncomba- 
tant casualties and insecurity throughout the province. By 2000 the 
GAM had made extensive advances in the countryside and was pro- 
viding government services in several areas of the province. 

The first three post- Suharto administrations attempted to negoti- 
ate a political settlement with the GAM. In early 2002, President 
Megawati Sukarnoputri authorized negotiations for a political settle- 
ment while maintaining military pressure on the GAM. In December 
2002, the two sides signed the Cessation of Hostilities Agreement. 
The situation on the ground was fragile from the start, and the agree- 
ment collapsed in May 2003 over the basic issue of the future of 
Aceh — whether it should be a province of Indonesia or an indepen- 
dent state. 

In May 2003, after the collapse of the agreement, the central gov- 
ernment implemented a year of martial law in Aceh, and combat 
operations resumed immediately. The subsequent joint military- 



324 



Antiterrorism sign, Sulawesi 
Courtesy Anastasia Riehl 




police action was the largest security operation since Indonesia's 
1975 invasion of East Timor, with an estimated 30,000 military per- 
sonnel and 20,000 police deployed against the GAM. Security oper- 
ations resulted in the death, capture, or surrender of thousands of 
alleged GAM cadre and supporters and drove armed GAM bands 
into remote areas of the province. Human-rights organizations 
charged that many of the casualties were innocent civilians. Because 
of heavy casualties, the GAM reverted to classic guerrilla warfare 
tactics. Nonetheless, it remained a potent military adversary and 
political force. 

When the devastating earthquake and tsunami struck Aceh in 
2004, more than 166,000 people died. The tragedy struck both sides 
of the insurgency, with heavy casualties among both guerrillas and 
government security forces and their families. The sheer magnitude 
of the tragedy created the conditions conducive to a comprehensive 
political settlement. As a result of the tragedy and the relief opera- 
tions that followed, Aceh finally reached the beginning of a compre- 
hensive solution to the long-running insurgency. After secret talks 
between representatives of the Indonesian government and the GAM, 
by mutual agreement between Indonesian President Yudhoyono and 
the GAM leadership, representatives of the two sides met in Helsinki, 
Finland, under the auspices of Crisis Management Initiative (CMI), a 
nongovernmental organization, led by the former Finnish president, 
Martti Ahtisaari. 

Both sides made significant concessions: The GAM agreed to 
accept the principle of autonomy and dropped its demand for complete 
independence, while the Indonesian government agreed to allow 
GAM members to run for elective office. The two sides signed a peace 
agreement on August 15, 2005. Disarmament of GAM forces and 



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Indonesia: A Country Study 

removal of police and military forces went smoothly, with decommis- 
sioning and demobilization completed on schedule by December 27, 
2005. The GAM formally dissolved itself in January 2006, although it 
is possible that remnants continue to exist. Indonesia's legislature 
passed a revised local autonomy law for Aceh in June 2006, which 
contained many of the provisions in the Helsinki agreement. Acehnese 
political leaders vowed to continue to strive for additional legislative 
concessions in the future. 

Successful province-wide elections took place in December 2006, 
in which former GAM figures competed for office with existing 
political parties. The election for governor resulted in a resounding 
victory for a former GAM spokesman, who defeated seven other can- 
didates and won almost 40 percent of the total votes cast. His closest 
competitor received only 1 7 percent. The election was significant for 
several reasons. First, it was peaceful, with virtually no violence dur- 
ing the campaign and vote. Second, the victor was a "local GAM" — 
one who stayed in Aceh during the insurgency — who defeated candi- 
dates representing the long-exiled international GAM leadership. 
Third, the winner defeated candidates supported by the existing polit- 
ical parties in Aceh. And fourth, there was no challenge to his victory, 
and national leaders and legislators in Jakarta pledged support for his 
tenure in office. District-level elections held at the same time brought 
many former GAM fighters into political office as well (see Elec- 
tions, ch. 4). By 2009 Aceh's government and administration func- 
tioned much as those in other provinces, although disputes over the 
application and enforcement of Islamic law or sharia (see Glossary) 
were here more strident than anywhere else in the nation. 

Papua 

Indonesia no longer faces a significant secessionist movement in 
its easternmost provinces of Papua and Papua Barat. Rather, the 
rapid changes at the start of the twenty-first century have exacerbated 
the preexisting problems of poverty, high unemployment, environ- 
mental degradation, and the poor quality of many government ser- 
vices. The greatest threat to security is posed not by secessionist 
violence but by increased social, ethnic, and religious tensions 
between the indigenous Papuan population and the swelling tide of 
non-Papuans from elsewhere in Indonesia, drawn by opportunities in 
the commercial, agricultural, and extractive industries in the two 
provinces. 

The remaining small secessionist movement in Papua is remote 
and fragmented. The Free Papua Organization (OPM) formed in 
1969 and has been conducting a low-level armed insurgency since 



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National Security 



then. The OPM is fragmented into several factions whose goals 
range from independence to a merger with neighboring Papua New 
Guinea, autonomy, or better treatment by the central government. 
The influx of new residents resettled under the government's now- 
defunct Transmigration Program (see Glossary) caused resentment 
among the indigenous population and brought new recruits into both 
the OPM's political and military structures. However, since the early 
2000s that resentment has manifested itself in mostly urban political 
demonstrations, and the OPM has steadily lost strength. Indonesian 
military operations in Papua have claimed many lives over the years, 
and nonviolent pro-independence OPM spokespersons have been 
jailed on charges of subversion. 

The fight between the OPM and the security forces pits a rudimen- 
tary force against a high-technology police and military. The remain- 
ing OPM guerrilla bands were concentrated in the hinterlands of 
Jayapura, Merauke, Mimika, and Paniai by late 2008. The guerrillas 
coordinate few, if any, of their operations; instead, they select and 
strike at targets as resources and opportunities become available. 
OPM targets include small police and military posts and patrols and 
unarmed, nonmilitary groups, such as civilian timber workers. The 
last significant attack by the OPM occurred in 2002, when a force led 
by admitted OPM guerrillas attacked a group of mostly American 
teachers near Tembagapura, site of a huge open-face mine operated 
by Freeport-McMoRan Copper and Gold — known locally as P. T. 
Freeport-Indonesia — and protected by Indonesian military and 
police, who are paid by Freeport. Two Americans and one Indonesian 
were killed, and eight Americans and Indonesians were wounded. By 
2006 the leaders of the attack had been captured, tried, and convicted 
of assault and murder. There were other attacks, also near the Free- 
port mine in 2009. 

The OPM is believed to have fewer than 1,000 armed guerrillas. 
Many of its unarmed supporters have turned their attention to peace- 
ful urban demonstrations to express grievances. Active, full-time 
OPM activity is limited to those guerrillas living in the jungles fight- 
ing with spears, bows, arrows, bush knives, and stolen and captured 
guns, mostly of military and police origin. The OPM is viewed as a 
political movement with an extremely limited military capability that 
poses no threat to Jakarta. However, it is another centripetal force 
encouraging the fragmentation of Indonesia. The central government 
maintains approximately 10,000 military and police in Papua. The 
missions of these forces include the destruction of OPM military 
units, general law and order and security, and protection of the desig- 
nated strategic industry locations that include the Freeport mine at 



327 



Indonesia: A Country Study 

Tembagapura and the growing development of the BP Tangguh natu- 
ral gas field around Bintuni Bay, in Papua Barat Province. 

Ethnic and Religious Conflict 

A key characteristic of Suharto's New Order regime was the prev- 
alence of security and order throughout the nation. Any outbreak of 
violence between ethnic or religious groups was quickly and sternly 
repressed. Tensions simmered below the surface, however, and after 
Suharto's fall in 1998, ethnic and religious conflict erupted in several 
regions. Security forces were initially ineffective in regaining con- 
trol because the police, poorly trained, poorly equipped, and under- 
staffed, were ill prepared to handle large-scale unrest. The TNI, 
stung by accusations of human-rights abuses, and resentful of the 
change in mission responsibility, was reluctant to intervene without a 
formal request for assistance from local authorities. 

In Kalimantan Barat Province, the relative harmony that had pre- 
vailed among native Malays, ethnic Chinese, and Dayaks for genera- 
tions was upset by the influx of hundreds of thousands of Madurese 
under the Transmigration Program in the 1970s and 1980s. Commu- 
nal violence in the 1 990s was triggered by Dayak discontent with the 
Madurese community's hold on the economic balance of power in the 
region, and by a perception that the Madurese were illegally taking 
Dayak land. Hundreds of settlers were killed in the Sambas area of 
Kalimantan Barat in early 1999 and the Sampit area of Kalimantan 
Tengah Province in February 2001. By April 2001, almost 100,000 
Madurese, many of whom had resided in Kalimantan for several gen- 
erations, had been evacuated to Madura and Java. Dayak leaders and 
government officials conducted reconciliation talks, but the return of 
the Madurese was slow to occur. 

Conflict broke out in Maluku Province in 1999 after a seemingly 
minor clash between a bus driver and a passenger who refused to pay 
his fare exploded into wide-ranging Muslim-Christian violence in 
Ambon that quickly expanded throughout the Maluku Islands. More 
than 5,000 people were killed between 1999 and 2002. Islamic mili- 
tants in Jakarta called for jihad to support their coreligionists on the 
islands. Similar Muslim-Christian violence flared around the Sulawesi 
Tengah city of Poso during the same period. Hard-line civilian and 
military sympathizers, who wanted to destabilize the regime of then- 
President Abdurrahman Wahid, collaborated to organize, train, equip, 
and arm the Laskar Jihad (Jihad Militia) and arranged the unimpeded 
transfer of several thousand members of the militia to both Ambon and 
Poso. This caused a major escalation of the conflict. The government 
declared a civil emergency, one step short of martial law. In February 



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National Security 



2002, leaders of the Christian and Muslim communities in Poso and 
Maluku Province signed two separate peace agreements aimed at end- 
ing three years of sectarian fighting. Both agreements were brokered 
by Muhammad Yusuf Kalla, who, two years later, was elected vice 
president of Indonesia. The level of conflict quickly fell, but sporadic 
violence remained endemic to the entire region. 

Terrorism 

Religious extremism has disturbed Indonesia's domestic security 
as far back as the 1950s and 1960s, when organizations such as 
Darul Islam and Bangsa Islam Indonesia fought for the establish- 
ment of an Islamic state. It was not until the early twenty-first cen- 
tury that terrorism, both domestic and international, was recognized 
as a major internal threat. In 2000 dozens of people died in a series 
of urban terrorist attacks on the Jakarta Stock Exchange and on 
churches and shopping malls on Sumatra and Java. In Singapore and 
Malaysia, authorities uncovered plots by the regional terrorist orga- 
nization Jemaah Islamiyah. Suspects arrested in Singapore revealed 
the existence of Jemaah Islamiyah cells in Indonesia. 

Indonesian authorities initially ignored intelligence warnings 
about terrorists inside Indonesia. Then, on October 12, 2002, Jemaah 
Islamiyah terrorists bombed two nightclubs in Kuta, Bali, killing 202 
people and injuring around 300, many of them foreign tourists. Sub- 
sequent Jemaah Islamiyah attacks in Jakarta in August 2003 and 
September 2004, as well as other bombings in Bali in October 2005, 
killed 49 more and injured 458, almost all Indonesians. These 
attacks finally led to recognition throughout Indonesia that Islamist 
terrorists were active in the country. Indonesian and international 
investigators tied earlier domestic terrorist attacks to Jemaah Islami- 
yah as well, and Indonesian leaders acknowledged the threat posed 
by international as well as domestic terrorists. In late 2004, the Yud- 
hoyono government adopted a more confrontational policy against 
terrorism, which appeared likely to remain a significant threat to 
Indonesia's security. 

Several security units have been specifically assigned a counter- 
terrorism mission. The newest of these is the National Police counter- 
terrorism unit, usually called Detachment 88, which was formed in 
2002 with extensive funding, training, and equipment from the 
United States. It has both investigative and tactical-response capabil- 
ities (see The National Police, this ch.). Detachment 88 has been suc- 
cessful in tracking down and arresting scores of accused and 
suspected terrorists and support personnel. Several high- value terror- 
ists were killed in armed shootouts. The Indonesian judicial system 



329 



Indonesia: A Country Study 

has convicted and imprisoned dozens of terrorists since 2005. The 
three men who planned the Bali bombings were executed in Novem- 
ber 2008 after more than three years of investigation, trials, convic- 
tions, and legal appeals. Indonesian authorities have made important 
progress against both organized terrorist organizations, such as 
Jemaah Islamiyah, and affiliated splinter terrorist cells. 

Each of the three branches of the TNI has at least one special oper- 
ations unit with a counterterrorism mission. The largest of these, Unit 
81, is part of the Army Special Forces Command (Komando Pasukan 
Khusus — Kopassus). There are also smaller counterterrorism units in 
the air force and navy. Unit 8 1 is highly trained in intelligence, detec- 
tion, and tactical-assault counterterrorist tactics. The navy's "frog- 
man" unit trains for counterterrorism raids against such maritime 
targets as offshore oil platforms, docks and harbor targets, and ships 
that have been seized by terrorists. 

The Armed Forces in National Life 

The armed forces did not initially seek to play a dominant political 
position, even though they played a role in the establishment of the 
republic, in the formative years of Indonesian parliamentary democ- 
racy. Circumstances, rather than deliberate planning, pressed the armed 
forces to gradually enlarge their role in national life. As it consolidated 
each stage of its growing political power, however, the military leader- 
ship grew protective of its gains. Suharto skillfully used the military as 
his primary instrument of power during his 32-year rule. In return, the 
military leadership was handsomely rewarded. The inculcation of Pan- 
casila and the institutionalization of dwifungsi brought the military to 
its most powerful position in the early 1990s. 

Some influential senior officers had, however, become concerned 
by the mid-1990s that the prestige and honor of the military were 
being compromised by excessive involvement in the day-to-day 
political and social affairs of the nation. Many moderate officers 
pressed for change, including former armed forces commander in 
chief General Edi Sudrajat, former National Defense Institute com- 
mandant Lieutenant General Sofian Effendi, the late Lieutenant 
General Agus Wirahadikusumah, and leading military intellectual 
Lieutenant General Agus Wijoyo. All four became leaders in the 
military reform movement after their retirement. 

Suharto's forced resignation in May 1998 was discreetly facilitated 
by the military leadership, which refused to seize power to protect the 
president's position. From its earliest days, the Indonesian military 
had never contemplated a coup d'etat in Indonesia; that tradition and 
the growing reformist element in the military played an important 



330 



Training in the field 
Courtesy U.S. Defense 
Attache's Office, Jakarta 
Special forces troops in formation 
Courtesy Indonesian 
Department of Defense 



Indonesia: A Country Study 

role in keeping the armed forces from taking power even though 
Suharto reportedly offered the presidency to General Wiranto, then 
the armed forces commander in chief. Since then, the armed forces 
have supported the transition to democracy, implemented a number of 
reforms, displayed a more moderate face to the populace, and main- 
tained discipline and a leadership image in contrast to that of the 
often corrupt and hapless post- Suharto civilian officialdom. The TNI 
remains the most powerful element in Indonesian society and retains 
significant influence over the country's political life. 

Political and Administrative Role 

Indonesia's transition from autocracy to democracy has been 
lengthy and difficult, with various power centers vying for a role in 
the new political environment. Enlightened leadership by Admiral 
Widodo Adi Sucipto (appointed by President Abdurrahman Wahid 
as the first naval officer to head the armed forces) and General 
Endriartono Sutarto, whose tenure as TNI commander in chief 
spanned the presidencies of Megawati Sukarnoputri and the early 
months of the first Susilo Bambang Yudhoyono administration, con- 
firmed the relatively restrained and more moderate role of the mili- 
tary at the beginning of the twenty-first century. The armed forces' 
perception of their political role has developed into that of a national 
institution above partisan interests and closely tied to the people, 
with a duty to foster conditions of order and security in which the 
habits of a stable and institutionalized political process can develop. 
This self-perception identifies a force far different from the one that 
fought for independence in the 1940s, evolved through the tumultu- 
ous political changes of the 1950s and 1960s, and subsequently 
engaged in a complex process of give-and-take with the autocratic 
Suharto during his long rule. 

Participation in the Economy 

The military has never been as dominant in the economic sphere 
as in the political sphere. Total military expenditures as a percentage 
of gross national product (GNP — see Glossary) began a steady 
decline in the 1960s, with the military share of the budget shrinking 
from 29 percent in 1970 to just over 1 percent by 2009. 

The military's primary means of economic influence derives from 
operation of a business empire, comprising both legal and illicit 
enterprises, which had its beginnings in the struggle for indepen- 
dence. It expanded in December 1957, when Dutch enterprises and 
agricultural estates were taken over by local trade unions and imme- 
diately put under direct military supervision. December 1958 legisla- 



332 



National Security 



tion led to the nationalization of these enterprises and estates during 
the first half of 1959. This involvement in commercial enterprises 
projected the military, especially the army, into a new sphere of 
activity, where it acquired entrepreneurial expertise, a vast patron- 
age, and a source of enrichment for many of its personnel. By the 
1990s, the military business empire may have provided as much as 
two-thirds of the total military budget. However, the region-wide 
economic crisis that began in 1 997 had a significant adverse effect 
on the TNI's income from off-budget sources. While the policy of 
economic involvement continued through the 1990s and into the 
twenty-first century, it was estimated that the large military business 
empire, and diversions from other budgetary resources, had declined 
significantly in the first decade of the 2000s. Although no definitive 
information has ever been provided on the amount of funds received 
from the military's business enterprises, it was estimated to have 
shrunk to less than half of the total funding received by the TNI. 

Engaged in enterprises such as air and highway transportation, 
shopping centers, and mines, many military-owned businesses oper- 
ate in the open market much like any private company. In an effort to 
gain greater control over the military-run business empire, in 2004 
the DPR mandated that such military businesses be civilianized by 
2009, a process that was not 100- percent completed on schedule. The 
TNI will continue to operate military-supervised cooperatives (simi- 
lar to the U.S. military's post-exchange and commissary systems). 

Far more controversial than these legitimate enterprises are the 
illicit businesses run by both the military and the police. Accurate 
information on such activities is understandably difficult to obtain. 
Both the armed forces and the police allegedly are involved in illegal 
businesses ranging from extortion, gambling, and "security protec- 
tion" rackets to more substantial enterprises such as illegal logging, 
support of renegade mining operations, and trafficking in marijuana. 
Subsequent to the separation of the police and the military in 1999, 
there have been occasional outbreaks of violence as personnel from 
the two institutions strive to protect "turf and at the same time 
poach on the illegal enterprises of the other side. 

Another kind of military enterprise was the service-owned fac- 
tory, which had as its primary purpose the production of ordnance 
and equipment for the armed forces. By the mid-1980s, however, the 
government had taken over and managed as public-sector enterprises 
such major concerns as the navy's P. T. PAL shipyard in Surabaya, 
Jawa Timur Province, and the army's munitions factories. 

While they cannot be singled out from other actors in the national 
economy, the armed forces of the early twenty-first century continue 



333 



Indonesia: A Country Study 

to face the problem of coping with a legacy of corruption. The mili- 
tary, though, is still viewed by Indonesian society as generally less 
corrupt than other sectors of the government. Nonetheless, the low 
salaries of military personnel require that they take up "constructive 
employment" to make ends meet. 

Total People's Defense 

Indonesia's military operations rely on a well-developed doctrine 
of national security called Total People's Defense (Hankamrata). 
Based on experiences during the struggle for independence, this doc- 
trine proclaims that Indonesia can neither afford to maintain a large 
military apparatus nor compromise its hard-won independence by 
sacrificing its nonaligned status and depending on other nations to 
provide its defense. Instead, the nation will defend itself through a 
strategy of territorial guerrilla warfare in which the armed forces, 
deployed throughout the nation, serve as a cadre force to rally and 
lead the entire population in a people's war of defense. Military plan- 
ners envision a three-stage war, comprising a short initial period in 
which an invader might defeat conventional Indonesian resistance 
and establish its own control, a long period of unconventional, 
regionally based fighting, and a final phase in which the invaders 
eventually are repelled. 

The success of this strategy, according to the doctrine, requires 
that a close bond be maintained between citizen and soldier to 
encourage the support of the entire population and enable the mili- 
tary to manage all war-related resources. The people would provide 
logistical support, intelligence, and upkeep in this scenario, and, as 
resources permit, some civilians would be organized, trained, and 
armed to join the guerrilla struggle. To support these objectives, the 
TNI maintains the army's territorial organization, comprising 12 
military regional commands (Komando Daerah Militer — Kodams) 
encompassing an estimated two-thirds of the army's strength. The 
territorial commands parallel the civilian governmental structure, 
with units at the province, district, and village level. Armed forces 
personnel also engage in large-scale civic-action projects involving 
community and rural development in order to draw closer to the peo- 
ple, ensure the continued support of the populace, and develop 
among army personnel a detailed knowledge of the region to which 
they are assigned. (Finally, and doctrine aside, the territorial struc- 
ture provided the base upon which most of the army business empire 
flourished.) 

Attention to potential external threats grew during the 1970s as 
planners became concerned with the growing military power of the 



334 



Army medics on 
civil-disaster duty 
Courtesy Indonesian 
Department of Defense 



newly unified Socialist Republic of Vietnam and its allies, including 
the Soviet Union. At the same time, China began publishing maps 
that made a claim to virtually all of the South China Sea, including 
the Natuna Islands, a chain off the western tip of Kalimantan. Indo- 
nesia responded with a major intraservice military exercise (Latihan 
Gabungan — LatGap — Joint Exercise) in the Natuna Islands. China 
soon withdrew the map, and relations between the two countries 
remained stable. 

Political developments in the late 1980s and early 1990s subse- 
quently relieved tensions in Southeast Asia. These developments 
included efforts to bring peace to Cambodia, during which Indone- 
sia's three-battalion deployment was the largest military contribution 
to the UN Transitional Authority in Cambodia (UNTAC); the with- 
drawal of Vietnamese troops from Cambodia; and the reduced per- 
ception of a general threat from Vietnam and China. Nonetheless, the 
potential for regional conflict — for example, over territorial claims in 
the Spratly Islands in the South China Sea — continued to trouble stra- 
tegic planners (see Foreign Policy, ch. 4). In the post-Cold War era, 
Indonesia has quietly continued to support the maintenance of a U.S. 
regional security presence to prevent a vacuum that could be filled by 
potentially less benevolent outsiders. 

Defense Spending and the Defense Industry 

Indonesia is unique among developing countries, and unusual 
among other Asian countries, in the relatively low priority given to 



335 



Indonesia: A Country Study 

defense spending. In 2009 there were some 302,000 personnel in 
Indonesia's active armed forces, and the military budget totaled 
US$3.4 billion, about the same military budget and force level as 
Thailand, a country with less than one-third of Indonesia's popula- 
tion, and Burma (Myanmar), which has only one-quarter of Indone- 
sia's population. Singapore, with a population less than 2 percent of 
Indonesia's, has more than 72,000 active-duty military personnel — a 
force more than nine times larger than Indonesia's on a per-capita 
basis. The results of Indonesia's relatively limited commitment to the 
military are aged weapons systems, poor maintenance, and low levels 
of combat readiness. The TNI's readiness posture was also badly 
affected by the arms embargo imposed by the United States and other 
arms suppliers. Chronic poor maintenance was compounded by Indo- 
nesia's inability to purchase spare parts, which resulted in the inoper- 
ability of most of the air force C-130 transport fleet, most of the 
transport helicopter fleet, and many of the navy's logistics and trans- 
port ships. The effect of these shortcomings was sadly demonstrated 
in the TNI's inability to respond quickly to the devastation caused by 
the 2004 tsunami. 

By the late 1970s, Indonesia had retired most of the Soviet-bloc 
military hardware left over from the Sukarno era. Between 1977 and 
1982, national allocations to the Department of Defense and Security 
and armed forces doubled in absolute terms, and modest upgrades 
took place in all three military services. Ensuing years saw the mili- 
tary portion of the budget stabilize at between 6 and 7 percent of the 
overall state budget. However, with the military having to obtain as 
much as two-thirds of its total revenues from its own business 
empire, the official budget figures were misleading. 

The last quarter of the twentieth century saw the purchase of mate- 
riel such as F-5 and F-16 fighter aircraft (in 1978 and 1988, respec- 
tively) and ground attack aircraft (in 1981); several used frigates 
and destroyers; and tanks, armored personnel carriers, and towed 
howitzers. The most controversial acquisition was the purchase, in 
the mid-1990s, of nearly the entire navy of the former Democratic 
Republic of Germany (East Germany — DDR). While the price for the 
39 ships was relatively low, the costs to upgrade, acclimatize, and 
maintain these aging vessels soon became prohibitive. The purchase 
strained the defense budget for many years, and by the early twenty- 
first century most of the ships were no longer operational. This pur- 
chase was arranged by then-Minister of Research and Technology B. 
J. Habibie, thus straining his relationship with the military. 

Many traditional military suppliers began to reduce the scope and 
breadth of military relations with Indonesia in the 1990s, to protest 



336 



National Security 



human-rights abuses in East Timor. The violence there in 1999 
caused the United States, the European Union (EU), and Australia to 
cease arms sales entirely. As a result, Indonesia's military equipment 
deteriorated dramatically because of a lack of spare parts and mainte- 
nance. Only after the December 2004 tsunami disaster in Aceh did 
those countries resume progress toward normalization of their respec- 
tive military-to-military relations. Because of that experience and to 
avoid the potential of any future military embargo, Indonesia has 
deliberately broadened its sources of military equipment and weap- 
ons systems. In the early twenty-first century, Indonesia completed 
agreements to acquire major weapons systems from Russia, China, 
several East European nations, the Republic of Korea (South Korea), 
and the Netherlands, among others. 

Indonesia is far from self-sufficient in the production of weapons 
and defense-related materiel. Domestic facilities remain inadequate 
for the repair of certain complex weapons systems, and equipment 
inventories often represent considerable overstatements of what is 
actually in functioning order. Moreover, although defense guidelines 
favor the standardization of weaponry and other defense materiel, 
such as communications equipment and ground and air transport sys- 
tems, the armed forces still possess and continue to procure equip- 
ment from a variety of sources. This situation has caused serious 
problems in obtaining and stocking spare parts and training technical 
maintenance personnel. 

Major defense industries were transferred from the armed forces 
to civilian control in the 1980s. Under a new policy, these plants also 
served the commercial and civilian sectors. For example, when fully 
operational in the 1990s, the aircraft industry produced parts and 
equipment for commercial aviation. Although the aircraft industry 
was for decades the favorite project of Suharto and his minister for 
research and technology (and successor as president), B. J. Habibie, 
it was another money- wasting effort that cost hundreds of billions of 
dollars. After Suharto's 1998 resignation, the aircraft industry stag- 
nated; and, by the early 2000s, it was producing very little, not even 
spare parts. The army's former munitions plants, by contrast, became 
very successful, manufacturing commercial explosives for the min- 
ing and petroleum industries as well as defense-related products. R 
T. Pindad, another former army plant, now produces much of the 
TNI's small arms as well as several models of wheeled and armored 
vehicles. The R T. PAL shipyard also manufactures commercial 
ships and maritime equipment, in addition to naval vessels. 



337 



Indonesia: A Countiy Study 
Personnel 

The size of the armed services — approximately 302,000 in 
2009 — is small in relation to Indonesia's large population. The mili- 
tary is also small in comparison to the forces of other nations of 
comparable population, and in comparison to the forces of other 
Asian countries. The army is by far the dominant branch of the Indo- 
nesian military, with approximately 233,000 personnel; the navy and 
marine corps total about 45,000 and the air force, about 24,000. 

The Indonesian constitutipn states that every citizen has the right 
and obligation to defend the nation. Conscription is provided for by 
law, but in light of limited civilian-sector employment opportunities, 
the armed forces have been able to attract sufficient numbers to main- 
tain mandated strength levels without resorting to a draft. By 2008 
almost all service members were volunteers who had met the criteria 
set for conscription. However, officer specialists, such as physicians, 
are occasionally conscripted for short-term service. Most enlisted 
personnel are recruited in their own regions and generally train and 
serve most of their time in units near their homes. Each service has 
small women's units (see Women in the Armed Forces, this ch.). 

The combined officer corps for the three services was estimated to 
total some 53,000 personnel in 2008. Until 2005 the mandatory retire- 
ment age for officers was 55, but a 2004 military act passed by the 
DPR provided for a gradual extension to age 60. Virtually all career 
noncommissioned officers (NCOs) serve 20 years and retire in their 
mid-forties, thereafter often going into private business. With person- 
nel strength mandated to remain static, a steady balance between new 
officer accessions and losses (through death, attrition, and retirement) 
seems likely to be maintained. 

For the first 20 years of independence, entry into the officer corps 
was very competitive. According to both patriotic and traditional val- 
ues, a military education and military career were regarded as highly 
desirable. Since the late 1970s, however, the armed forces have expe- 
rienced difficulty attracting a sufficient number of the best-qualified 
candidates to the Armed Forces Military Academy (Akmil), the 
national service academy at Magelang, Jawa Tengah Province. Field 
commanders have long complained of not getting enough high-quality 
young officers from Akmil. Improved job opportunities in Indonesia's 
advancing economy have persuaded many of the brightest and best- 
qualified high-school graduates to attend civilian degree-granting uni- 
versities (Akmil does not grant academic degrees). In the late 1990s, 
the armed forces began to expand their source of officers by institut- 
ing a program similar to the U.S. Reserve Officers' Training Corps 



338 



National Security 



(ROTC) and experimented with educating a small number of cadets in 
overseas civilian colleges. 

The armed forces have maintained cohesion and a professional 
esprit de corps, in spite of problems with officer recruitment. Matura- 
tion through institutionalization, increased education, and an empha- 
sis on national (rather than regional) loyalty have produced a military 
that is a far cry from the factionalized and ideologically diverse force 
that existed at the time of the 1965 coup attempt. Uniting the services 
under a strong central command and eliminating "warlordism" and 
regionalism by routine rotational assignments have contributed to this 
cohesion and minimized the impact of the occasional emergence of 
personality-driven cliques. 

The senior officer corps reflects the ethnic composition of the 
national population. The TNI does not publish data on ethnicity in its 
personnel rosters, but a review of the names of 60 top officers in TNI 
headquarters and the three services suggested that in 2008 about 55 
percent were from Java (ethnically Javanese, Sundanese, or Madurese), 
a proportion approximately reflective of the national population. There 
is a continued trend toward assignments based on ability rather than 
ethnic or religious considerations. 

Organization and Equipment of the Armed 
Forces 

Administrative and Command Structure 

The TNI consists of three military services — the army, navy, and 
air force. The Department of Defense (Dephan) is responsible for 
planning, acquisition, and management tasks, but has no command or 
control of troop units (see fig. 13). As part of the post-Suharto reform 
program, each of Suharto's successors as president has appointed a 
civilian as minister of defense. However, each of these ministers has 
remained outside the military chain of command. A major goal of 
political reformers is to restructure the chain of command to place the 
TNI under genuine civilian control. This intent was reflected in the 
policy guidance contained in the military law passed by the DPR in 
2004, but there was no time schedule for effecting such a major 
change. The TNI commander retains command and control of all 
armed forces, in the meantime, and continues by tradition to be the 
senior Indonesian military officer. Since the separation of the Depart- 
ment of Defense from the armed forces headquarters in 1985, the 
department's staff has been composed largely of active-duty and 
retired military personnel. The structure of Dephan consists of the 
offices of the minister of defense, a secretary general, an inspector 



339 



Indonesia: A Country Study 



PRESIDENT, SUPREME 
COMMANDER OFTHE 
ARMED FORCES 



COMMANDER IN CHIEF, 
ARMED FORCES 



INSPECTOR GENERAL 



PERSONAL STAFF 



ASSISTANT FOR 
GENERAL PLANNING 



CHIEF OFTHE 
GENERAL STAFF 



ASSISTANT FOR 
COMMUNICATIONS- 
ELECTRONICS 



ASSISTANT FOR 
INTELLIGENCE 



ASSISTANT FOR 
LOGISTICS 



ASSISTANT FOR 
OPERATIONS 



ASSISTANT FOR 
PERSONNEL 



ASSISTANT FOR 
TERRITORIAL 
AFFAIRS 



- 4 ARMY CHIEF OF STAFF 



MILITARY REGIONAL 
COMMANDS (12) 
(KODAMS) 



ARMY STRATEGIC 
RESERVE COMMAND 
(KOSTRAD) 



ARMY SPECIAL 
FORCES COMMAND 
(KOPASSUS) 



HEAD, ARMED FORCES STRATEGIC 
INTELLIGENCE AGENCY 



ARMED FORCES CENTERS, 
AGENCIES, AND SCHOOLS 



Operational Command 

Training, Administrative, 
and Personnel Support 



AIR FORCE CHIEF OF STAFF 



AIR MATERIEL 
COMMAND 



AIR TRAINING 
COMMAND 



AIR FORCE 
OPERATION COMMANDS 
(KO-OP I, KO-OP-II) 



NATIONAL AIR 
DEFENSE COMMAND 
(KOHANUDNAS) 



NAVY CHIEF OF STAFF 



NAVY FLEETS (2) 
(ARMADAS) 



MARINE CORPS 
COMMAND 



AIR ARM 
COMMAND 



MILITARY SEALIFT 
COMMAND 



Figure 13. Organization of the Armed Forces, 2009 



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National Security 



general, and five directors general, as well as several functional cen- 
ters and institutes. In 2009 the minister of defense was a civilian, 
while the secretary general was an active-duty military officer. The 
inspector general and five directors general were a mix of active and 
retired senior military officers. 

The role of the individual armed services has not changed since 
1969, when the heads of the army, navy, and air force were reduced to 
chiefs of staff. At that time, operational control of almost all military 
units was vested in the armed forces commander in chief. The head- 
quarters of each military service functions primarily as an administra- 
tive and support center. 

The TNI staff and its functions remain directly subordinate to the 
commander in chief of the armed forces, who remains, in turn, directly 
responsible to the president, who holds the formal title of supreme 
commander of the armed forces. Directly under the TNI commander 
are the chief of the general staff (Kasum), the TNI's next most senior 
officer; the inspector general; the assistant for general planning; and 
the heads of a number of agencies and institutes. The TNI Kasum has 
assistants for communications and electronics, intelligence, logistics, 
operations, personnel, and territorial affairs. The TNI general staff 
supports the headquarters of each of the three services, and its person- 
nel are drawn from all three services. 

The army territorial structure focuses on the 12 military regional 
commands (Kodams), with the chain of command flowing directly 
from the armed forces commander in chief to the Kodam commanders, 
and from them to subordinate army territorial commands (see fig. 14). 
The senior operational air force commands are the National Air 
Defense Command (Kohanudnas) and the East Operations Command 
and West Operations Command (Komando Operasi — Ko-Ops). The 
navy has an Eastern Fleet and a Western Fleet (each called an Armada). 

The armed forces commander in chief exercises control over most 
of the combat elements of the army, navy, and air force through the 12 
army Kodams, the two air force Ko-Ops, and the two navy Armadas. 
The commander in chief also exercises operational control over the 
air force's Kohanudnas and the two army strike force commands — the 
Army Strategic Reserve Command (Kostrad) and the Army Special 
Forces Command (Kopassus). 

Kostrad was formed in the early 1960s during the West Irian cam- 
paign. It was from his position as Kostrad commander that Suharto 
organized opposition to the 1965 coup attempt. The powerful post has 
been filled since then by officers considered particularly loyal to the 
president. In 2009 Kostrad had a strength of approximately 40,000 
personnel. It consists of two divisions, each containing airborne and 



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Indonesia: A Country Study 




CO 

g 

I 
I 



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infantry brigades; a separate airborne brigade; one cavalry brigade; 
two field artillery regiments; and several combat support and service 
support units. In early 2005, the armed forces commander in chief 
announced plans to expand the independent brigade, based near 
Makassar, Sulawesi Selatan Province, into a third division to be based 
primarily in Papua. 

Kopassus numbered some 5,000 military personnel in 2009, iden- 
tifiable by their distinctive red berets. Organized into three opera- 
tional groups, a counterterrorism unit, and a training center, Kopassus 
personnel receive training in intelligence gathering, special opera- 
tions techniques, sabotage, and airborne and seaborne landings. 

There are official and unofficial militia-style paramilitary forma- 
tions throughout Indonesia in addition to the regular armed forces. 
Once a formidable force estimated between 70,000 and 100,000 
strong, the official militia units have been largely disbanded or inte- 
grated into the army. The far more dangerous unofficial militia-style 
units act as surrogate forces, usually for Kopassus, and have a reputa- 
tion for violence and intimidation. Many are little more than criminal 
gangs protecting their "turf," often around markets and shopping cen- 
ters, where they collect "security and protection" money. They also 
have provided manpower for political demonstrations and intimida- 
tion. Militia units trained by army cadre were responsible for much of 
the wave of violence that swept East Timor in 1999. 

Military Education 

The TNI operates a central military academy headquarters charged 
with curriculum standardization, but the three service academies are 
under the control of their respective service chiefs of staff. Cadets 
begin a one-year training program at the Armed Forces Military Acad- 
emy (Akmil) in Magelang, which is followed by three-year courses in 
the specialized branches of Akmil run by each service. The army 
branch, referred to simply as the Military Academy, is located in 
Magelang as well. The Air Force Academy is located in Yogyakarta 
and the Naval Academy, in Surabaya. 

The TNI also maintains a joint headquarters for the Armed Forces 
Command and Staff School (Mako Sesko) and the three service com- 
mand and staff schools, but control of the individual command and 
staff colleges is under the service chiefs of staff. Cohort ties formed at 
the service academies and at the command and staff school are strong 
unifying elements among officers. The joint TNI Command and Staff 
College (Sesko TNI) trains officers at the lieutenant colonel level, 
and the National Resiliency Institute (Lemhanas) provides training at 
the colonel and brigadier general levels. Half of each Lemhanas class 



343 



Indonesia: A Country Study 

is filled by senior civil servants and leaders of the business commu- 
nity. In 2009 Dephan established the Indonesian Defense University 
(Universitas Pertahanan Indonesia), modeled on the U.S. National 
Defense University in Washington, DC. It is the first military school 
in Indonesia to award academic degrees. 

Branches of Service 

Army 

The Army of the Republic of Indonesia (TNI-AD) historically 
has been the dominant military service, headed by the army chief of 
staff, a four-star general. His staff includes a vice chief of staff, an 
inspector general, and assistant chiefs of staff for logistics, opera- 
tions, personnel, planning and budget, security, and territorial affairs. 
Army strength in 2009 was approximately 233,000. 

The chief of staff is responsible for personnel, training, administra- 
tion, and logistical support of the army. Commanders and staff of each 
Kodam are responsible for administration, logistics, personnel, train- 
ing, and the general welfare of assigned and attached combat units. 
Each Kodam is divided into successively smaller administrative units. 
These include the Military Resort, or Garrison, Command (Korem); 
Military District Command (Kodim); and Military Subdistrict Com- 
mand (Koramil). At the bottom of the structure, noncommissioned 
officers (NCOs) are assigned to every village in the country, where 
they are known as the village NCO (babinsa). 

Military operations are rarely, if ever, conducted in any formation 
larger than a battalion. Each Korem has control of at least one battalion, 
and one or more battalions come under the direct control of the Kodam. 
Army doctrine distinguishes between centrally controlled units and 
regionally controlled units. Centrally controlled units are found in 
Kostrad and Kopassus. Regionally controlled units by definition are 
those assigned to the 12 Kodams. The battalions have a planned 
strength of nearly 700 personnel, although many — those in the Kodams 
in particular — are under strength. Each Kodam has at least one desig- 
nated quick-reaction force battalion; these are the best-trained and - 
equipped units in the territorial structure. Both types of battalions have 
experienced frequent temporary deployments to areas of insecurity, 
including East Timor (prior to 1999), Aceh (prior to 2005), and Papua. 

The army has an aviation arm that performs liaison and limited 
transport duties. The unit operates several rotary-wing squadrons 
with helicopters of various national origins and one composite fixed- 
wing squadron composed mostly of light aircraft and small trans- 
ports, such as the domestically produced CASA-235. 



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The army is equipped with a variety of weapons systems acquired 
from several European and Asian countries and the United States, as 
well as domestically manufactured items. Because of funding con- 
straints, emphasis is placed on maintenance and rehabilitation of older 
equipment. The mainstays of the armored force are its French-built 
AMX-13 light tanks and the variant AMX-VCI reconditioned armored 
personnel carrier, mostly acquired in the late 1970s. Domestic industry 
supplies nearly all of the army's small-arms requirements, although a 
substantial number of M-16 rifles purchased from the United States in 
the 1980s remained in the inventory two decades later. Domestically 
produced arms include Belgian-licensed FNC rifles, submachine guns, 
and machine guns. Ammunition is in short supply. 

Although army recruits receive their basic training in a local train- 
ing facility located in each Kodam area, specialist corps training is 
provided at the appropriate national corps centers. NCOs must attend 
training courses and pass examinations in their specialized fields 
prior to promotion. The army maintains a large tactical training area 
at Baturaja, Sumatera Selatan Province, where selected units undergo 
small-unit training on a rotational basis. 

Navy 

The Navy of the Republic of Indonesia (TNI-AL) became a sepa- 
rate service in 1946, after the National Revolution began. Its vessels 
come from a variety of countries, including the United States. The 
fleet includes submarines from the Federal Republic of Germany, 
light frigates from the Netherlands and Britain, and fast-attack craft 
from South Korea. In 1992 the Indonesian government acquired 39 
used ships of various types from the navy of the former Democratic 
Republic of Germany (East Germany). The acquisition proved to be a 
mistake of major proportions. The ships were in poor condition, not 
suited for operations in the tropics, and difficult to staff and maintain. 
By 2005 many of them had been mothballed. The Indonesian navy 
itself produces numerous small coastal craft in national shipyards. 

In 2009 the fleet consisted of more than 90 ships and numerous 
smaller vessels. The newest warships are four Sigma-class corvettes 
from the Netherlands, three of which were delivered by 2008 and the 
fourth, by 2009. As newer warships and patrol craft entered the inven- 
tory, the navy decommissioned older vessels. Nevertheless, the navy 
was underequipped and under strength for its mission of protecting the 
nation's huge maritime expanse against piracy, poaching, and smug- 
gling. Specifically, it needed a large infusion of fast-patrol craft to 
cover its wide internal seas and coastlines, as well as increased sealift 



345 



Indonesia: A Country Study 

capacity to move marine corps and army units and equipment to trou- 
ble spots across the archipelago. 

Structurally, the navy comprises the headquarters staff at Jakarta 
under the overall command of the navy chief of staff, two fleet com- 
mands (the Eastern Fleet at Surabaya and the Western Fleet at 
Jakarta), the marine corps, a small air arm, and a military sealift 
command (see fig. 15). About 45,000 uniformed personnel were 
serving in the navy in 2009, including about 20,000 marines. The 
marines are organized into two divisions (formerly designated as bri- 
gades), one stationed in Jakarta and the other in Surabaya. A third 
independent brigade is planned to become the core of a third divi- 
sion, once funds and manpower become available. The marine corps 
is equipped with light tanks, armored personnel carriers, and anti- 
aircraft guns. Most of the corps' heavy equipment consists of badly 
outdated former Soviet-origin armored vehicles. 

The navy began maintaining a small air arm in 1958. Headquartered 
at Surabaya, it had about 1,000 personnel in 2009. It is equipped pri- 
marily for naval reconnaissance and coastal patrol duties, flying three 
squadrons of light airplanes, as well as several transports and helicop- 
ters. The military sealift command coordinates the navy's logistical 
support systems. 

The navy's missions include providing strategic sealift for the 
army and marine corps and support for operations responding to natu- 
ral disasters. Other responsibilities include patrolling the strategic 
straits through which a major portion of the world's shipping passes 
between the Pacific and Indian oceans, particularly the Strait of Ma- 
lacca. That crucial waterway carries an estimated 80 percent of com- 
mercial and military traffic between the Pacific and Indian oceans. 
Formerly a haven for piracy, the Strait of Malacca is now patrolled by 
the cooperative efforts of Indonesia, Malaysia, and Singapore, and 
piracy incidents have declined. Another naval mission focuses on 
halting smuggling and illegal fishing, both of which are especially 
prevalent near the Natuna Islands and in the seas around Sulawesi 
and Maluku. In support of this latter mission, the navy announced 
plans in the late 1980s to construct a number of limited-role bases in 
isolated areas in the eastern and western sections of the national terri- 
tory. Funding restrictions, however, have kept this project from ful- 
fillment. Some new bases have been built, including Tual in the 
southeastern part of Maluku Province, and the naval stations on Biak 
and Manokwari in Papua Barat Province have been upgraded. Patrol 
activity in the Sulu Sea and Sulawesi Sea (Celebes Sea) has increased 
as part of operations to detect and interdict movement by terrorists 
and maritime criminal activities where the maritime borders of Indo- 
nesia, Malaysia, and the Philippines meet. 



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National Security 



The P. T. PAL shipyard, operated since the 1980s by the civilian 
government, along with other facilities in Surabaya, continues to be 
the navy's primary training, repair, and industrial center. Smaller- 
craft construction facilities are located at shipyards in Jakarta, Sema- 
rang (Jawa Tengah Province), Manokwari (Papua Barat Province), 
and Ambon (Maluku Province). P. T. PAL also constructs commer- 
cial ships in a variety of sizes and types. The navy has begun an 
innovative acquisition program by which individual provincial gov- 
ernments fund the purchase of fast-patrol craft to be turned over to 
the navy. Those ships are used for maritime security, generally in the 
territorial waters bordering the donor province. 

Air Force 

The Air Force of the Republic of Indonesia (TNI-AU), like the navy, 
was established as a separate service in 1946. The influence and capa- 
bility of the air force decreased sharply after the 1965 coup attempt. The 
service was heavily purged because of the alleged involvement of its 
chief of staff, General Omar Dhani, in the Indonesian Communist Party 
(PKI). Significant modernization did not get under way until the late 
1970s, with acquisition of F-5 and A-4 aircraft from the United States, 
and in the 1980s, with the acquisition of F-16 fighters from the United 
States and Hawk fighters from Britain. The imposition in the late 1990s 
of arms embargoes by the United States and other countries in response 
to Indonesia's human-rights violations, particularly in East Timor, 
resulted in a very low readiness level in the air force. In the early 2000s, 
Indonesia began to seek nontraditional suppliers, purchasing Sukhoi jet 
fighters from Russia and obtaining jet trainers from Singapore (by dona- 
tion) and South Korea (primarily through countertrade). The United 
States ended its arms embargo of Indonesia in 2005, and the air force 
began a high-priority program to restore the readiness of its C-130 
transport fleet and the F-16 fighter force. 

Air force strength was about 24,000 in 2009. Approximately 4,000 
of these personnel formed four battalions of "quick-action" paratroop- 
ers. Structurally, the air force consists of a headquarters staff in Jakarta 
supporting the chief of staff; three operational commands: Ko-Op 1/ 
West, Ko-Op II/East, and the National Air Defense Command; and two 
support commands: the Air Materiel Command and the Air Training 
Command (see fig. 16). The Air Materiel Command is headquartered 
in Bandung, Jawa Barat Province, and the Air Training Command is in 
Surabaya, Jawa Timur Province. Air operations are covered by two 
area commands, with the boundary between Jawa Tengah and Jawa 
Timur provinces being the east-west dividing line. The largest of the 
operational commands is Ko-Op II, headquartered in Makassar, 



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Indonesia: A Country Study 




Figure 15. Navy Fleet Commands, 2009 




Figure 16. Air Force Operations Commands, 2009 



Sulawesi Selatan Province. Ko-Op I is headquartered in Jakarta. The 
National Air Defense Command, also headquartered in Jakarta, has 
operational control over all fighter and counterinsurgency aircraft. 

Most of the major weapons systems operated by the air force are 
manufactured in the United States. The C-130 Hercules, OV-10F 
Bronco, F-5E Tiger II, A^4E Skyhawk, and F-16 Fighting Falcon 
aircraft are all U.S. -made. Aircraft manufactured elsewhere include 
the British Hawk and Russian Sukhoi fighters. The air force also 
deploys several B-737 aircraft for maritime reconnaissance, a num- 
ber of domestically produced small transports, and a fleet of helicop- 
ters. During the modernization period of the 1980s, the air force also 
purchased the Automated Logistics Management System (ALMS) 
from the United States to upgrade its ability to track and requisition 
spare parts and other materials. 



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National Security 



In 1980 the air force enunciated a forward defense strategy that 
required it to build or upgrade air bases throughout Indonesia as well 
as main bases in Java. Most of those upgrades affected civilian air- 
fields also used by the air force. A major upgrade at Ranai Air Base in 
the Natuna Islands provided a post for improved surveillance of the 
South China Sea. Iswahyudi Air Base in Jawa Timur Province was 
upgraded to enable it to handle modern jet fighter aircraft. Acquisi- 
tion of the F-16 and Hawk systems resulted in further upgrades at 
Pekanbaru Air Base, Riau Province, and at Hasanuddin Air Base near 
Makassar, Sulawesi Selatan Province. 

New pilots generally begin flight instruction in propeller-driven 
T-34 Turbo-Mentors. A squadron of British Aerospace T-53 Hawks 
is used for advanced training. Acquisition of the KT-1 Wongbee 
from South Korea, the SF260 SIAI Marchetti from Singapore, and 
training versions of the F-16 has significantly expanded the training 
base. However, competition with higher-paying civilian airlines has 
led to a chronic shortage of pilots and aviation support personnel. 

Conditions of Service 

Compensation of all TNI personnel is on a sliding scale according 
to rank and is uniform nationally and across the three services. Offi- 
cers and enlisted personnel receive housing for married service mem- 
bers of appropriate rank, subsistence items and rations paid in kind, 
and a variety of allowances in addition to base pay. Especially at the 
lower ranks, compensation is so low that the need for supplementary 
income is a significant factor in service members' involvement in 
outside, often unsavory, employment. 

The retirement age for officers was 55 until passage of the 2004 
military laws, which raised the retirement age to 60 effective in 2009. 
Retirement at age 42 is mandatory for enlisted personnel. The presi- 
dent has the authority to grant an unlimited number of one-year 
extensions to active duty; these usually go to officers in key leader- 
ship posts. Officers are eligible for small pensions at age 48; those 
who have failed to gain promotion to lieutenant colonel are required 
to retire at that time. Two years before retirement, personnel can be 
placed on preretirement status, in which they draw full pay and allow- 
ances while beginning to develop civilian careers. 

Women in the Armed Forces 

Each branch of the TNI and the National Police has a women's 
component: the Women's Army Corps, the Navy Women's Corps, 
the Air Force Women's Corps, and the Women's Police Corps. 
According to official publications, women members of the armed 



349 



Indonesia: A Country Study 

forces are "set to work at places and in functions conforming] to 
their feminine disposition." More specifically, women are assigned 
to administrative work, intelligence work, English-language instruc- 
tion, and activities to improve the health and social conditions of 
armed forces members and their families. They also specialize in the 
welfare of women and children. Despite the advance of women in 
the civilian workplace, including one former president, several cabi- 
net members and legislators, and important business leaders, women 
do not advance to comparable rank in the armed forces. Women 
police officers are said to "play an important role in solving prob- 
lems [of] drug addicts and juvenile delinquents." Some police com- 
mands in large cities also have rape/gender-based violence units 
staffed by female officers, but these are still rare. 

Uniforms, Ranks, and Insignia 

Grade and rank structure is standard throughout the three military 
services and corresponds to that common to most military systems. 
One title unique to Indonesia is panglima, a traditional heroic rank 
revived during the National Revolution. Although panglima is often 
translated as "commander," it has a stronger connotation of honor 
and power. In the 1980s, tradition evolved to limit the title panglima 
to the armed forces commander in chief and the Kostrad and Kodam 
commanders. 

Uniforms of the three services are distinguished by color and 
style, with variations in headgear and other details distinguishing 
some elite troops, who wear berets of various colors. Army working 
and ceremonial uniforms are olive drab. Air force uniforms are 
medium blue, and navy uniforms are navy blue. Rank insignia are 
standardized among the services (see fig. 17; fig. 18). In ceremonial 
and service dress, officers wear rank insignia on the shoulder epau- 
let. Field-uniform insignia were moved in 1991 from the front of the 
fatigue shirt to the collar tip. Rank insignia are worn on the sleeves 
by NCOs and enlisted personnel. 

Foreign Military Relations 

Consistent with its foreign policy of nonalignment, Indonesia does 
not maintain defense pacts with other nations. It has security agree- 
ments with a broad range of countries (not including the United 
States), and it does participate in combined military exercises with 
several other countries. Over the years, Indonesia also has contributed 
troop contingents — some including either military or police personnel 
or both — to most UN peacekeeping forces deployed to global trouble 



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351 



Indonesia: A Country Study 

spots. Among other places, Indonesia has sent forces to the Suez 
Canal-Sinai Peninsula area (1957 and 1973-79), Democratic Repub- 
lic of the Congo (1960-64), Iran-Iraq border (1988-90), Namibia 
(1989-90), Kuwait-Iraq border (1991), Somalia (1991), Cambodia 
(1991-93), Bosnia-Herzegovina (2000), and Lebanon (2006-8). 

Indonesia was a founding member of the Association of Southeast 
Asian Nations (ASEAN — see Glossary), and although the organiza- 
tion was not established as a defense alliance, there is a history of mil- 
itary cooperation between Indonesia and its ASEAN partners. This 
cooperation is manifested both frequently and bilaterally and includes 
exchanges of military representatives at national defense institutions, 
periodic security consultations, and a series of joint military exercises 
with individual ASEAN states. ASEAN countries pledge their sup- 
port for the security of each of the other ASEAN nations but stop 
short of discussing formation of a military alliance. The Indonesian 
government stresses that defense cooperation among ASEAN nations 
is a function of each nation's right to protect itself and that bilateral 
cooperation will not lead to any bilateral or ASEAN-wide defense 
pact. Indonesia plays a leading role in the ASEAN Regional Forum 
(ARE), a non-treaty security umbrella organization that includes 
nations and organizations as members — including the United States, 
China, the EU, and Russia — that are not ASEAN states. 

Indonesia also conducts combined military exercises with non- 
ASEAN nations, including Australia, Britain, France, India, New Zea- 
land, and the United States. During the 1980s, defense officials sug- 
gested that joint border patrols might be set up with Papua New 
Guinea, and the two countries signed a status-of-forces agreement in 
January 1992. Indonesian troops sometimes cross the border from 
Papua Province into Papua New Guinea in pursuit of armed insurgents. 

Indonesia has maintained military-assistance agreements with sev- 
eral countries. It received funded security assistance from the United 
States every year between 1950 and 1992 except 1965 and 1966, 
when relations were at a low ebb. Most security-assistance programs 
were restored after 2005. Grant aid for military equipment, which 
ended in 1978, averaged US$13 million per year and was used mainly 
to procure logistics equipment, communications systems, and combat 
materiel for internal security. The United States also provided grant 
aid training under the International Military Education and Training 
(IMET) program from 1950 until 1992, when the U.S. Congress cut 
the aid in reaction to the human-rights situation in East Timor. In that 
42-year period, more than 4,000 Indonesian military personnel 
received IMET training in the United States. The IMET program 
resumed in 2005. U.S. Foreign Military Sales (FMS) credits were 



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Indonesia: A Country Study 

periodically made available to Indonesia starting in 1974 and have 
helped defray the cost of procuring U.S. -made military equipment. 
U.S. Foreign Military Financing (FMF) provides grants or loans for 
the acquisition of U.S. military articles, services, and training by 
Indonesia. Indonesia has also received military aid from Australia, 
Britain, France, Germany, the Netherlands, and Russia, among others. 
In the early 1960s, Indonesia acquired equipment from the Soviet 
Union, and though most of it was inoperative by the 1970s, Jakarta 
continued to make payments to the Russian government after the 
demise of the Soviet Union in 1991. Since the late 1990s, Russia has 
again become an important arms supplier for the Indonesian armed 
forces, including a US$1 billion loan that Indonesia is using to buy, 
among other items, attack and transport helicopters and jet fighters. 

The military relationship with the United States went into decline 
starting in 1992 and worsened in 1999, when the United States sus- 
pended all military cooperation programs to protest the TNI's support 
of militia forces that rampaged across East Timor in the wake of that 
former province's vote for independence. Australia, Britain, and sev- 
eral other countries also reduced or suspended their military pro- 
grams with Indonesia at the same time. However, the terrorist attacks 
against the United States on September 11, 2001, began the slow 
return of some cooperation programs because of the perceived need 
to enlist the support of the world's most populous Muslim nation in 
the global war against terrorism. The December 2004 earthquake and 
tsunami that devastated parts of Aceh prompted the U.S. government 
to reexamine its policy of isolating the TNI from training, education, 
and other aspects of the military-to-military relationship. In March 
2005, the United States began FMS sales of nonlethal spare parts for 
transport aircraft. By 2008 Indonesia had regained eligibility to par- 
ticipate in most aspects of a military-to-military relationship with the 
United States. 

Security and Intelligence Agencies 

Only very general information has been made public regarding 
the organization and activities of Indonesia's intelligence and secu- 
rity bodies. In 2001 the name of the central intelligence-gathering 
institution was changed from the National Intelligence Coordinating 
Body (Bakin) to the National Intelligence Agency (BIN). Primarily 
cosmetic, the name change was designed to reflect the changes asso- 
ciated with the end of the Suharto era. BIN analyzes both domestic 
and foreign intelligence gathered by its own personnel as well as by 
the military services and the police. It is directly under the control of 



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National Security 



the president and maintains its own communications network out- 
side the civilian and military administrations. 

In 2004, after a series of devastating terrorist bombings in Indonesia, 
the president strengthened the authority of the BIN chief to coordinate 
all intelligence activities conducted by the military, police, and civilian 
intelligence agencies. In practice, such coordination has proved diffi- 
cult to achieve because of inherent conflicts of interest and zealous pro- 
tection of turf by the various agencies. BIN also was authorized to 
establish branch offices at the provincial level throughout Indonesia, 
and to direct all counterterrorism intelligence operations. 

The TNI's agency for intelligence collection relating to external 
defense and internal security, processing, and operational functions is 
the Armed Forces Strategic Intelligence Body (Bais). Commanded by 
a major general, Bais is directly subordinate to the TNI commander. 

The National Police 

The National Police of Indonesia (Polri) has been financed, 
directed, and organized by the central government since 1945. Polri 's 
main duties are to maintain public order and security. However, its 
personnel strength is far below the UN-prescribed police-to-populace 
ratio of 1:350 (the Indonesian ratio is approximately 1:630). For 
many decades, Polri was a fourth branch of the armed forces, then 
known as ABRI. In 1999, after the fall of Suharto, the police force 
was separated from the military and placed directly under the presi- 
dent. As part of this reorganization, the police did away with military 
ranks and titles and adopted standard international police nomencla- 
ture. In the 10 years since Polri ceased being part of the armed forces, 
it has enjoyed a resurgence in professionalism and an increase in 
strength. In 2009 Polri's estimated strength was around 280,000. 

The national chief of police is the highest-ranking police officer in 
the nation. Like the TNI commander, he is appointed by the president 
and must be confirmed by the DPR. Assigned to Polri headquarters in 
Jakarta are a deputy police chief, extensive staff, and several separate 
administrative bodies that handle specialized police functions. Polri 
has its own territorial organization, with a police unit and police chief 
for each province (Regional Police — Polda). Each Polda unit is admin- 
istratively subdivided at the district, subdistrict, and village levels. 
Polda Metrojaya, which has responsibility for metropolitan Jakarta, is 
subdivided into precincts, sections, and police posts. 

Each province is assigned police units varying in strength and 
composition according to the needs dictated by the characteristics of 
the different areas within that province. These forces are organized as 
municipal police forces or rural units and are under the operational 



355 



Indonesia: A Country Study 

direction of the Polda commander, who in turn is directly responsible 
to Polri headquarters. All police elements are charged with support- 
ing the local government in their respective areas. 

Polri has maintained its centralized chain of command but has also 
been made responsive to the individual provincial governors since the 
rise of sustained democratic governance. Each governor is authorized 
to call on the police to respond to emergencies, for example, and both 
the police chief of an affected region and the governor may request 
military assistance if police resources prove insufficient. 

Police forces are functionally organized into a number of special- 
ized elements. The largest of these is the uniformed police, which 
includes both the general police, who perform conventional police 
duties relating to the control and prevention of crime and the protection 
of property, and the traffic police, who patrol the nation's roadways 
and supervise the licensing of drivers and the registration of motor 
vehicles. Also part of the uniformed force are the Women's Police 
Corps, which has been increasingly integrated into the Polri structure. 
Female police officers have been transformed from their old orienta- 
tion, which was primarily directed toward the provision of social ser- 
vices, to a situation in which female police officers are involved in 
virtually every aspect of Polri missions, including counterterrorism and 
antiriot duties. The first female provincial police chief was appointed 
in 2007, in Banten Province. Elite units of special police enforce order 
in terrorist situations beyond the capability of the regular forces. These 
units had about 14,000 personnel in 2009, were better armed and more 
mobile than the general police, and lived in separate barracks under 
stricter discipline. The special police wear the same uniform as other 
police but are distinguished by special badges. Plainclothes police have 
the primary responsibility for criminal investigations, especially in 
complex cases or in cases involving several jurisdictions. They also 
handle forensics, intelligence, security, and the technical aspects of 
crime fighting, such as fingerprinting and identification. 

A small unit, the Sea and Air Police, patrols the national waters 
and airspace, providing tactical aid to other elements by regulating 
traffic, guarding against smuggling and illegal fishing, and supply- 
ing personnel transport. The unit also participates in disaster relief. 
Its equipment includes a few helicopters and light airplanes and var- 
ious small seacraft. 

The Mobile Brigade, one of the oldest Polri units, was formed in 
late 1945. Its original tasks were disarming remnants of the Japanese 
Imperial Army and protecting the chief of state and the capital city. 
The brigade fought in the Revolution, and its troops took part in the 
military confrontation with Malaysia in the early 1960s and in the con- 



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flict in East Timor from the mid-1970s through 1999. The Explosive 
Ordnance Devices Unit, formed in 1981, is part of the Mobile Brigade. 

The exigencies of fighting separatist insurgents in Aceh and Papua 
required the rapid expansion of the Mobile Brigade. Between 1998 and 
2005, it grew from 7,500 to approximately 34,000 personnel. Such a 
rapid expansion brought problems in training and discipline, and the 
Mobile Brigade has come to be regarded by many observers as the 
least disciplined and most brutal of all forces deployed against insur- 
gents. It is essentially a paramilitary organization trained and organized 
along military lines. The brigade is used primarily as a deploy able 
combat force in emergencies, aiding in police operations requiring 
quick action. It also works in domestic security and defense operations 
and has special riot-control equipment. Elements of the force also are 
trained for airborne operations. 

The need to forge a capable police counterterrorism unit in response 
to the spread of international terrorism resulted in the establishment in 
2002 of another elite element, the National Police counterterrorism 
unit, better known as Detachment 88. This unit was largely funded and 
trained by the United States and graduated its first cadre in 2003. It has 
the capability to conduct counterterrorism and modern forensic inves- 
tigations, and it includes a quick-reaction counterterrorist team. 
Detachment 88 has been particularly successful in its counterterrorist 
operations. Its personnel, supported by technical assistance and train- 
ing from the United States and Australia in particular, have captured or 
killed many of the most-wanted terrorists in the country, including 
those responsible for bombings in Bali and Jakarta, terrorism in 
Sulawesi Tengah Province, and attacks against civilian targets else- 
where in Indonesia. 

Rank-and-file police service is voluntary. Recruits must have at 
least a sixth-grade education and pass a competitive examination. 
Other qualifications include physical fitness and good moral character. 
After three years' service as ordinary police, personnel with only 
junior secondary-school diplomas can enter training to become NCOs. 
Those with three years' experience as NCOs are eligible for further 
training to enable them to become candidate officers and eventually 
enter the officer corps. The majority of the police officer corps enters 
the force as graduates of the National Police Academy, located near 
Sukabumi, Jawa Barat Province. The Polri working and ceremonial 
uniforms are dark brown. 

Advanced training in vocational and technical subjects is available 
to regular police, NCOs, and officers. Promotions often are based on 
performance in advanced education. The Police Command and Staff 
School at Semarang, Jawa Tengah Province, offers advanced training 



357 



Indonesia: A Country Study 

in administration and logistics to police officers assigned to command 
units at the subdistrict, district, and Polda levels. 

The Criminal Justice System 

The nation's criminal jurisprudence and its institutions of criminal 
justice derive from Indonesia's experience as an independent state 
and from the Dutch colonial heritage. Dutch-based criminal law is 
one of three systems of law in operation in the nation since the nine- 
teenth century, the other two being a system of European-derived 
commercial codes and civil law based on customary law (adat), 
which includes Islamic law or sharia (see Islam, ch. 2). Criminal law 
is the only one of these three systems that is essentially codified and 
applied uniformly throughout the national territory. Criminal justice 
is administered through a system that includes a hierarchy of trial 
and appellate courts with the Supreme Court at the top of the pyra- 
mid; a prosecutorial arm of the national government; and an inde- 
pendent bar. Indonesians and outside observers have long considered 
the criminal justice system one of the most corrupt branches of the 
Indonesian government. 

Several factors limit the use of formal legal channels in dealing 
with activity defined as criminal. Owing in large part to a general 
shortage of trained legal personnel, the infrastructure of the criminal 
justice system is more extensive in urban locales and in Java than in 
rural or remote areas. In any case, the system's procedures often do 
not apply to military, security, and intelligence organizations, which 
in practice sometimes deal with both political and ordinary crime. 
Indonesians do not always resort to the formal legal system to resolve 
their conflicts, however, because many do not share Western views 
regarding the nature of individual rights and the efficacy of law and 
procedural justice but prefer to settle disputes by arbitration or accom- 
modation. Retribution and revenge, moreover, are still common ways 
of settling disputes, especially away from the big cities and towns. 

In rural areas, many conflicts, including some (mostly minor) 
criminal cases, are settled by village chiefs. Complaints often go 
unfiled with authorities, even in villages and cities, and cases fre- 
quently settle out of court in order to save time and money or to 
avoid attracting public or official attention. In criminal cases, such 
settlements typically entail accommodation between the accused and 
the police or prosecutors, whose roles in the criminal justice system 
are generally more critical than those of courts or judges. Wealth and 
status are apt to be important factors in the outcome. 



358 



National Security 



Crime and Political Offenses 

Indonesia, like many nations, has experienced a rising crime rate 
as a by-product of increased urbanization and the social and eco- 
nomic dislocations associated with national development. The scope 
of the crime problem is difficult to gauge, but conditions such as 
large numbers of unemployed or underemployed people in the cities, 
a lack of jobs for high school and university graduates, and a break- 
down in traditional systems of social control often are cited as 
responsible for the increase in crime. By the start of the twenty-first 
century, the annual increase in crime was moderate. Both the author- 
ities and the public, however, continued to be concerned about the 
increasingly violent nature of Indonesian society. 

Certain categories of crime are handled under special statutes out- 
side the penal code under Indonesian law. After the fall of Suharto, 
offenses such as bribery, the assessment of pungli (a contraction of 
pungutan liar — illegal levies), and the diversion of public funds for 
private use by business figures or officials were grouped in a special 
class of crimes under the jurisdiction of anticorruption courts and the 
Commission to Investigate Public Officials' Wealth. The transition 
to democracy also included abolition of an internal subversion act 
that had been used to jail critics of the Suharto government. 

Criminal Law and Proceedings 

The Indonesian criminal code in force at independence was basi- 
cally the Netherlands Indies Criminal Code, adopted in 1918, plus 
certain amendments promulgated by the revolutionary government 
in 1946. Known as the Code of Criminal Law, since 1958 it has been 
applied uniformly throughout the national territory. 

The Code of Criminal Law has three chapters. Chapter I defines 
the terms and procedures to be followed in criminal cases and speci- 
fies mitigating circumstances that may affect the severity of a sen- 
tence. Chapters II and III, respectively, define the categories of 
felonies and misdemeanors and prescribe the penalties for each type 
of offense. The distinction between felonies and misdemeanors gen- 
erally conforms to that in Western countries. Several other statutes 
dealing with criminal offenses are also in force, the most significant 
of which are laws concerning economic offenses, subversive activi- 
ties, and corruption. 

Penalties for major offenses include death (infrequently imposed, 
for treason, drug trafficking, and — since 2002 — terrorism, among other 
crimes), imprisonment for periods up to life, local detention, and fines. 
Total confiscation of property is not permitted. Penalties for minor 



359 



Indonesia: A Country Study 

crimes and misdemeanors include deprivation of specified rights, for- 
feiture of personal property, and publication of the sentence of the 
court. Punishments listed in the code are the maximum allowable; 
judges have discretionary authority to impose a lesser punishment. 

New guidelines on criminal proceedings were promulgated on 
December 31, 1981. These new guidelines, known collectively as the 
Code of Criminal Procedures, replaced a 1941 code that was itself a 
revision of an 1848 Dutch colonial regulation that stipulated legal 
procedures to be used in both criminal and civil cases. Both national 
jurists and government officials had complained that statutory ambi- 
guity in the old code and certain of its provisions in some cases had 
led to abuses of authority by law enforcement and judicial officials. 
Under the old system, several authorities, including the police, the 
regional military commands, and the public prosecutors, shared pow- 
ers of arrest, detention, and interrogation — an often confusing situa- 
tion that sometimes led plaintiffs to file complaints with the particular 
agency they believed would deal most favorably with their case. Indi- 
viduals could be arrested and detained on suspicion alone, and there 
were broad limits on how long a suspect could be held before being 
charged or brought to trial. Moreover, the accused could request legal 
counsel only when that individual's case was submitted to a judge, 
and not during any pretrial proceedings. 

The 1981 code represents a considerable step forward in the estab- 
lishment of clear norms of procedural justice. Under it, criminal 
investigation powers lie almost entirely with the police. A suspect can 
be held only 24 hours before the investigating officials present their 
charges and obtain a detention order from a judge. Specific limits are 
established on how long a suspect can be held before a trial. The 1981 
code expressly grants the accused the right to learn the charges 
against him or her, to be examined immediately by investigating offi- 
cials, and to have the case referred to a prosecutor, submitted to a 
court, and tried before a judge. The accused also has the right to 
obtain legal counsel in all of the proceedings. Should it turn out that a 
person has been wrongly charged or detained under the 1981 code, 
that individual has the right to sue for compensation and for the resto- 
ration of rights and status. 

Administration of Criminal Justice 

The prosecutorial function rests with the attorney general, who 
holds the position of supreme public prosecutor. The president some- 
times grants the attorney general cabinet-level status, and the attorney 
general has direct access to the president. The Attorney General's 
Office is separate from the Department of Justice and Human Rights. 



360 



The Attorney General's Office, Jakarta 
Courtesy Yadi Jasin 

The public prosecutor's principal functions are to examine charges 
of felonious conduct or misdemeanors brought by individuals or 
other parties, and then either to dismiss a charge or refer it for trial to 
the state court having jurisdiction. The prosecutor's office is also 
responsible for presenting the case against the accused in court and 
for executing the sentence of the court. 

The Code of Criminal Procedures of 1981 made a clear division 
between the investigation function, solely the preserve of the police, 
and the prosecution function, which remained with the prosecutor's 
office. The only exception was in the case of "special crimes," a cate- 
gory that was not further defined but that was believed to be reserved 
for unusually sensitive cases such as espionage and subversion, in 
which the prosecutor could also take an investigatory role. Continu- 
ing tension between the prosecutor and the police was evident during 
debate over a new prosecution service law in 1991. The law as passed 
gave the attorney general the power to conduct limited investigations 
in cases that were determined to be incomplete. The 1991 law also 
established deputy and associate attorney general positions responsi- 
ble for civil cases and administrative affairs. 

The court system has four branches: general courts, religious 
courts, military courts, and administrative courts (see The Judiciary, 
ch. 4). All criminal cases are tried in the general courts. The Code of 



361 



Indonesia: A Country Study 

Criminal Procedures set forth rules to determine the court in which a 
case must be tried, should military and general court jurisdiction 
combine or overlap. In 2004 the armed forces accepted Supreme 
Court jurisdiction over the military court system, and in 2007 the 
DPR introduced legislation stipulating that all crimes committed by 
military personnel outside of operational military duties will be pros- 
ecuted in the civil court system. The TNI has opposed this new law 
by claiming that the civilian court system neither understands the mil- 
itary justice system nor is capable of taking over responsibility for 
prosecution of military personnel accused of nonmilitary crimes. Ser- 
vice members remain subject solely to the military legal system for 
all crimes allegedly committed while in the pursuit of military duties. 

Penal System 

Indonesia's prisons are administered by the Department of Cor- 
rections within the Department of Justice and Human Rights and 
include three categories of prisons based mainly on the number of 
inmates they can hold. The nine largest prisons, designated Class I, 
hold prisoners sentenced to life imprisonment or death. 

The U.S. Department of State's Country Reports on Human Rights 
Practices for 2009 found prison conditions harsh throughout the Indo- 
nesian penal system. Poor food, unsanitary conditions, and inadequate 
medical care were common, as were mistreatment and corruption. 
"Money talks," and wealthy inmates were able to purchase better 
prison accommodations, food, and treatment. Overcrowding in ancient 
and inadequate facilities also occurred. The report indicated that those 
conditions had existed for a very long time and noted the need for bet- 
ter training of prison personnel and renovation of prison facilities. 

Several specialized prisons for women and two for youths are 
located in Java. Where it is not possible to confine such prisoners in 
separate institutions, as is usually the case outside Java, efforts are 
made to segregate juvenile from adult offenders and females from 
males in separate sections of the same institution. Ordinarily, prison- 
ers are permitted visits by family members and may receive limited 
amounts of food and other articles to supplement the minimal supplies 
they are issued. Under some circumstances, prisoners are permitted to 
spend their nights at home. Most prisons try to provide medical care 
of some kind, although it is generally regarded as insufficient. 

Rehabilitation provisions include literacy classes, moral and reli- 
gious training, and workshops to teach crafts and skills. Some pris- 
ons operate small industries or agricultural enterprises that sell their 
products on the local market. Proceeds are used to pay a small wage 
to the working inmates, to buy recreational equipment, and to main- 



362 



National Security 



tain buildings and grounds. In some prisons, inmates work in fields 
outside the prison confines. 

Narcotics and Counternarcotics Operations 

Production of narcotics, particularly opiate-derived products from 
the "Golden Triangle" where Thailand, Burma, and Laos meet, sub- 
stantially increased in the 1980s and 1990s. Despite its proximity, 
Indonesia is neither a major producer nor a major user of illicit drugs, 
although there is an increasingly broad niche for designer drugs, such 
as methylenedioxymethamphetamine (MDMA, or Ecstasy), among 
wealthy youth in the larger cities. There is, however, considerable 
concern on the part of the national leadership and police officials that 
Indonesia might become an important drug-trafficking center as 
major drug routes in mainland Southeast Asia shift to take advantage 
of Indonesia's relatively innocent reputation. 

Bali, which has become a booming international tourist destination, 
provides a base for individual traffickers and transactions. Although 
there is no extradition treaty between the United States and Indonesia, 
Indonesian authorities are cooperative in deporting drug suspects, par- 
ticularly if the International Criminal Police Organization (Interpol) is 
involved. During 1991, for example, a suspected American drug traf- 
ficker was deported to the United States with the cooperation of the 
U.S. Drug Enforcement Administration, the National Police of Indo- 
nesia, and Interpol. In addition, there have been periodic police cam- 
paigns in Aceh and Sumatera Utara Province, which are historically 
the country's leading producers of marijuana (some of which has long 
been used traditionally in the local cuisine). 

Narcotics trafficking is a severe offense in Indonesia, as is the 
case in neighboring Singapore and Malaysia. A considerable number 
of traffickers — mostly foreigners — have received death sentences 
from the courts; most executions in Indonesia are for crimes involv- 
ing narcotics trafficking. 

National Security in the Contemporary Era 

Indonesia has changed dramatically since the fall of Suharto in 
1998, and the military and police forces have changed with the coun- 
try. No longer an autocracy, Indonesia is now the world's third-largest 
democracy. The Indonesian military has implemented an impressive 
array of reforms that have removed the armed forces from an intrusive 
role in virtually every aspect of civil society and taken them out of 
day-to-day political involvement. At the same time, the military is still 
the most powerful institution in Indonesia and will likely remain so for 



363 



Indonesia: A Country Study 

some time. This is due both to the slow development of viable civilian 
institutions — repressed during the 32-year rule of Suharto — and the 
military's inherent power. Similarly, the National Police is evolving, 
thanks to extensive international assistance and a core of reform- 
minded police leaders determined to improve both the image of the 
police force and its professionalism in maintaining law and order. 

Indonesia is the most populous Muslim-majority nation in the 
world, and its practice of Islam the world's most moderate. The 
dynamic changes since 1998 have shown that democracy and Islam 
can coexist peacefully in a multi-ethnic, multi-religious society. The 
world's fourth most populous country, Indonesia can play a major 
role in international and regional political, economic, and social 
affairs. By 2008 Indonesia had become a valued, long-standing par- 
ticipant in the war against international terrorism. 

Neither the armed forces nor the police has implemented the full 
range of reforms called for by their most vocal critics. Vested inter- 
ests remain in play, and resistance to change is as natural to the Indo- 
nesian security forces as to those of other countries. But a new 
president and minister of defense, a newly empowered MPR, South- 
east Asia's most free press establishment, and a civilian society anx- 
ious to realize its potential have combined to make continued change 
in the security and military institutions inevitable. Greater civilian 
control over military and police forces, realizable only when much 
better budget control can be achieved, is a longer-term goal that 
might take as long as 10 to 20 years to attain. 

Many challenges remain. The military and, to a lesser degree, the 
police have an ingrained culture of impunity that can be broken only 
by implementation of clear accountability for misdeeds, successful 
implementation of the rule of law, and reform of the national judicial 
system. These are system- wide reform objectives not achievable by 
the military and police alone. 

* * * 

Several works treat the development of the Indonesian armed forces 
before 1970, the most balanced and comprehensive being Ulf Sund- 
haussen's The Road to Power: Indonesian Military Politics 1945- 
1967. Ernst Utrecht's The Indonesian Army: A Socio-Political Study of 
an Armed Privileged Group in the Developing Countries offers a 
detailed and often critical view from the perspective of a former insider. 
Ruth T. McVey's two-part "The Post-Revolutionary Transformation of 
the Indonesian Army" focuses mainly on the military's shortcomings in 
its early years. The Indonesian Tragedy, by Brian May, and The Army 



364 



National Security 



and Politics in Indonesia, by Harold A. Crouch, are more concerned 
with the causes and effects of the 1965 coup attempt; they also evaluate 
the armed forces in a somewhat negative light. The National Struggle 
and the Armed Forces in Indonesia, a collection of essays by ABRTs 
former official historian, Nugroho Notosusanto, presents the viewpoint 
of the armed forces and the government regarding ABRTs historical 
development, its role, and its doctrine. The most comprehensive look at 
Indonesian military organization, the dwifungsi concept, and the role of 
the military in Indonesian society is Robert Towry's 1986 work The 
Armed Forces of Indonesia. 

A number of books examine recent developments. Kevin O'Rourke's 
Reformasi: The Struggle for Power in Post-Suharto Indonesia provides 
background on economic and political issues as well as details on the 
chaos surrounding Suharto's resignation. Adam Schwarz's A Nation in 
Waiting: Indonesia in the 1990s covers Indonesian political maneuver- 
ing during that decade. Two recent accounts of the issues facing the TNI 
in the transition to democracy are The Military and Democracy in Indo- 
nesia: Challenges, Politics, and Power, by Angel Rabasa and John B. 
Haseman, and Toward a Stronger U.S.— Indonesia Security Relationship, 
by John B. Haseman and Eduardo Lachica. Readers interested in 
detailed histories of the TNI's intelligence-gathering and special opera- 
tions will find Kenneth J. Conboy's books of particular interest, includ- 
ing Kopassus: Inside Indonesia's Special Forces', Intel: Inside Indo- 
nesia s Intelligence Services; and Elite: The Special Forces of Indonesia 
1950-2008. A particularly useful account of modern Indonesian history 
is Indonesian Destinies, by Theodore Friend. 

Current reportage is available in the Indonesian chapter of Jane s 
Sentinel Security Risk Assessments: Southeast Asia, regularly updated 
and available on-line by subscription (http://sentinel.janes.com/) or in 
hard copy. The Van Zorge Report, published fortnightly in Jakarta, 
provides excellent reportage and analysis on all aspects of Indonesian 
political, economic, and security affairs. The periodically updated 
"Current Data on the Indonesian Military Elite," compiled in Cornell 
University's journal Indonesia, is helpful in keeping up with the most 
current assignments of senior military officers. The periodic reports on 
Indonesia published by the International Crisis Group are distinctive 
for their depth and accuracy of research and reporting. Data on the size 
and composition of the armed forces are collected by the International 
Institute for Strategic Studies in its annual publication, The Military 
Balance, and in an annual U.S. Department of Defense resource, the 
Congressional Presentation Document. Dephan offers a public Indo- 
nesian-language Web site (http://www.dephan.go.id), part of which 
includes its Defense Media Centre with an English-language option. 



365 



Indonesia: A Country Study 



Annual reports by Amnesty International and Human Rights 
Watch examine the state of human rights practices in Indonesia, as 
do the annual Country Reports on Human Rights Practices prepared 
for the U.S. Congress by the Department of State. (For further infor- 
mation and complete citations, see Bibliography.) 



366 



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Kong); "Current Data on the Indonesian Military Elite," published in Cor- 
nell University's journal Indonesia (http://cip.comell.edu/indonesia); Indo- 
nesian Department of Defense, Defense Media Centre (http://www.dephan. 
go.id); Far Eastern Economic Review (Hong Kong); Human Rights Watch 
(http://www.hrw.org/en/asia); International Institute for Strategic Studies, 
The Military Balance; U.S. Department of Defense, Defense Security 
Assistance Agency, Congressional Presentation; and Van Zorge Report on 
Indonesia: Commentary and Analysis on Indonesian Politics and Econom- 
ics (Jakarta) (http://www.vanzorgereport.corn/report/index.cfm).) 



404 



Glossary 



abangan — Refers to people who are nominally Muslim but who are 
generally followers of kebatinan (q.v.). The word is derived from the 
Javanese abang, which means "red." 

Asian Development Bank — Established in 1967, the bank assists in 
economic development and promotes growth and cooperation in 
regional member countries. The bank is owned by its 48 regional 
member governments, including Indonesia, as well as 1 8 nonregional 
members in Western Europe plus the United States. 

Association of Southeast Asian Nations (ASEAN) — Founded in 1967 for 
the purpose of promoting regional stability, economic development, 
and cultural exchange. ASEAN's founding members were Indonesia, 
Malaysia, the Philippines, Singapore, and Thailand. Brunei joined 
ASEAN in 1984, Vietnam joined in 1995, Laos and Burma in 1997, 
and Cambodia in 1999. Papua New Guinea has observer status, and 
there are 1 1 dialogue partners: Australia, Canada, China, the European 
Union, India, Japan, South Korea, New Zealand, Russia, the United 
States, and the United Nations Development Programme (UNDP). 
Timor-Leste has requested to be considered for membership. The 
ASEAN Regional Forum (ARF) was established in 1994 to foster 
constructive dialogue and consultation on political and security issues 
of common interest and concern. In 2009 it had 26 members, including 
the 10 ASEAN member states, Papua New Guinea, and Timor-Leste. 

Bahasa Indonesia — The Indonesian national language, also known as 
Indonesian; an Austronesian language thought to have its roots in 
Riau Malay and 80 percent cognate with Standard Malay. The so- 
called perfected or new spelling of Bahasa Indonesia — ejaan yang 
disempurnakan (EYD) — was adopted in 1972. 

Confrontation (Konfrontasi) — In 1963 then-President Sukarno ordered 
"confrontation" with the emerging new state of Malaysia, in part to 
distract attention from Indonesia's increasingly dire economic straits. 
Guerrilla warfare and intelligence operations involving Indonesian 
forces, British commandos, and the nascent Malaysian armed forces 
ensued, mostly on both sides of the two countries' land border on 
Kalimantan; went on for two years; and was only halted after 
Sukarno lost power in October 1965. 



405 



Indonesia: A Country Study 

Consultative Group on Indonesia (CGI) — Formed after the March 1992 
demise of the Inter-Governmental Group on Indonesia (IGGI; q.v). 
Except for the Netherlands, the membership was the same as for the 
IGGI. The Indonesia government disbanded the CGI in 2007. 

cukong — A Chinese term from Hokkien dialect, meaning "master" but 
taken in the Indonesian context to mean a Chinese businessman or 
middleman cooperating closely with native Indonesian legal license 
holders, especially the military, during the New Order period. 

exclusive economic zone — Per Act No. 3 of 1983, enacted October 18, 
1983, the outer strip bordering the Indonesian territorial sea as deter- 
mined by the law applicable to the Indonesian waters, covering the 
seabed, the subsoil of the seabed, and the water above it with an 
outermost limit of 200 nautical miles, measured from the baseline of the 
Indonesian territorial sea. Within this zone, Indonesia claims sovereign 
rights to conduct the exploration, exploitation, management, and con- 
servation of the living and nonliving resources on the seabed and in the 
subsoil thereof, as well as the water above it, including other activities for 
the purpose of economic exploration and exploitation of the zone, such as 
the generation of power by means of water, current, and wind. 

fiscal year (FY) — Calendar year. Prior to 2001, the fiscal year ran from 
April 1 to March 3 1 . The change meant that FY 2000 covered only nine 
months. 

Free Aceh Movement (Gerakan Aceh Merdeka — GAM) — A separatist 
group that fought for Acehnese independence between 1976 and 2005. 
Also known as Aceh Sumatra National Liberation Front (ASNLF; see 
table A). 

Fretilin (Frente Revolucionaria do Timor Leste Independente; Rev- 
olutionary Front for an Independent East Timor) — A guerrilla 
movement that fought for the independence of East Timor. Fretilin 
was established in 1974, suppressed during the ensuing 25 years, but 
endured Indonesian occupation and emerged as the first governing 
party of independent East Timor in 1999. 

Gini index — The Gini coefficient expressed as a percentage. The Gini 
coefficient measures the extent to which the distribution of income (or, in 
some cases, consumption expenditure) among individuals or house- 
holds within an economy or society deviates from a perfectly equal 
distribution. It measures the degree to which two frequency (percentage) 
distributions correspond. The Gini index is a number between and 1, 
where means perfect equality (everyone has the same income) and 1 
means perfect inequality (one person has all the income, everyone else 



406 



Glossary 



earns nothing). It was developed by Corrado Gini (1884-1965), an 
Italian statistician. 

Golkar — Originally golongan karya, which literally means functional 
groups within society, such as peasants, workers, and women, but later 
taken to be Golongan Karya or Golkar (an organization of functional 
groups), the government party during Suharto's New Order. The 
Golkar Party, with many changes, is one of many parties in the post- 
New Order period. 

gross domestic product (GDP) — A value measure of the flow of domestic 
goods and services produced by an economy over a period of time, 
such as a year. Only output of goods for final consumption and 
intermediate production are assumed to be included in the final prices. 
GDP is sometimes aggregated and shown at market prices, meaning 
that indirect taxes and subsidies are included: when these direct taxes 
and subsidies have been eliminated, the result is GDP at factor cost. 
The word gross indicates that deductions for depreciation of physical 
assets have not been made. Income arising from investments and 
possessions owned abroad is not included, only domestic production — 
hence the use of the word domestic to distinguish GDP from gross 
national product (GNP; q.v.). 

gross national product (GNP) — The gross domestic product {q.v.) plus net 
income or loss stemming from transactions with foreign countries, 
including income received from abroad by residents and subtracting 
payments remitted abroad to nonresidents. GNP is the broadest measure- 
ment of the output of goods and services by an economy. It can be 
calculated at market prices, which include indirect taxes and subsidies. 
Because indirect taxes and subsidies are only transfer payments, GNP 
often is calculated at factor cost by removing indirect taxes and subsidies. 

Indonesian Communist Party (Partai Komunis Indonesia — PKI) — 
Founded in 1913 as the Indies Social-Democratic Association (ISDV), 
which became the Communist Association of the Indies (PKH) in 1920 
and was renamed the Indonesian Communist Party in 1924. The PKI 
flourished during the Sukarno years of the 1950s and early 1960s. 
Accused of attempting a coup d'etat on September 30, 1965, during 
which five senior military officers were killed, the party was 
suppressed in an ensuing pogrom by the armed forces and ordinary 
citizens. The actual role of the PKI in the September 30 incident is still 
the subject of historical examination in the wake of the resignation of 
former president Suharto in May 1998. 



407 



Indonesia: A Country Study 

Indonesian National Armed Forces (Tentara Nasional Indonesia — TNI) — 
This official designation of the Indonesian armed forces was adopted in 
April 1999 after the National Police of Indonesia (Kepolisian Republik 
Indonesia — Polri) was removed from the armed forces (it had been a co- 
equal fourth branch since 1960). The former name for the armed forces, 
from 1962 to 1999, was Angkatan Bersenjata Republik Indonesia 
(ABRI; Armed Forces of the Republic of Indonesia). TNI was also used 
between 1947 and 1962 for the army. 

Inter-Governmental Group on Indonesia (IGGI) — An international group of 
lenders established in 1967 by the Netherlands to coordinate multilateral 
aid to Indonesia. The other members included the Asian Development 
Bank (q.v.\ International Monetary Fund (IMF), United Nations 
Development Programme, World Bank, Australia, Belgium, Britain, 
Canada, France, Germany, Italy, Japan, New Zealand, Switzerland, and 
the United States. In March 1992, Indonesia announced that it was 
rejecting further IGGI aid as long as the Netherlands was a member of 
the organization. The IGGI was replaced by the Consultative Group on 
Indonesia (q.v.\ with the original members minus the Netherlands. 

kebatinan (mysticism) — An amalgam of animist, Hindu-Buddhist, and 
Islamic (especially Sufi) mystical elements that combine to form 
Javanese mysticism. Not a single body of faith, but an aliran, a 
"stream" of beliefs held by a number of groups, kebatinan is officially 
recognized by the government, and its schools are administered by the 
Department of National Education rather than by the Department of 
Religious Affairs. Also known as kejawen, agama Jawa, or Javanism. 

Konfrontasi — Confrontation (q. v.). 

Laakso-Taagepera Index — A commonly used measure to determine the 
effective number of political parties when parties vary substantially in 
their vote or share of seats. It is named after political scientists Markku 
Laakso and Rein Taagepera, who developed the index in 1979. 

Nonaligned Movement — Established in September 1961 with the aim of 
promoting political and military cooperation apart from the traditional 
East and West blocs. Indonesia was among the original members; as of 
2009, there were 118 members, 15 observers, and 24 guests. Indonesia 
held the chair of the Nonaligned Movement from 1992 to 1995. 

Organization of the Petroleum Exporting Countries (OPEC) — Founded 
in Baghdad, Iraq, on September 14, 1960, by Iran, Iraq, Kuwait, Saudi 
Arabia, and Venezuela with the aim of coordinating petroleum 
policies of its member countries. OPEC membership increased with 
the addition of Qatar in 1961, Indonesia and Libya in 1962, the United 



408 



Glossary 



Arab Emirates in 1967, Algeria in 1969, Nigeria in 1971, Ecuador in 
1973, Gabon in 1975, and Angola in 2007. Ecuador suspended its 
membership from 1992 to 2007; Gabon terminated its membership in 
1995; Indonesia, when it became a net importer of oil, suspended its 
membership effective January 2009. 

Outer Islands — Older term used by some sources to refer to all islands of the 
Indonesian archipelago other than Java and Madura. Other sources, 
however, use the term to refer to all islands except Java, Madura, Bali, 
and Sumatra; still others say except Java and Bah or exclude Java, 
Madura, and Bali. The term as translated from Dutch — buitengewesten — 
means outer territories or regions, while a similar term from Bahasa 
Indonesia (q.v.ytanah seberang — means land (or lands) over there, or 
across the seas. The term is sometimes considered pejorative by those 
people living on the islands indicated 

Pancasila — State philosophy based on five interrelated principles: belief in 
one supreme God; just and civilized humanitarianism; nationalism as 
expressed in the unity of Indonesia; popular sovereignty arrived at 
through deliberation and representation or consultative democracy; and 
social justice for all the Indonesian people. The Pancasila was announced 
by Sukarno on June 1, 1945. From Sanskrit: panca (five) and sila 
(principle). It became the country's official doctrine under Suharto, when 
all military and civil servants were required to attend a course on 
Pancasila principles. While still a part of the national doctrine, its 
importance has waned in the post-Suharto years. 

pribumi — Literally, an indigene, or native. A term coined in the post- 
colonial period to replace the Dutch word inlander, a term that also 
meant "native" but which did not refer to Arabs, Chinese, or Eurasians 
who might have been bom in the Indies. The distinction between 
pribumi and non-pribumi has had significant implications for 
economic development policy. 

priyayi — Traditional aristocratic, bureaucratic elite of Java. 

reformasi — An Indonesian blanket term for democratic reforms initiated 
and implemented by all elements of government after the 1998 fall of 
Suharto, up until around 2004. 

Repelita (Rencana Pembangunan Lima Tahun) — A five-year economic 
development plan: Repelita I (FY [q.v.] 1969-73), Repelita H (FY 1974- 
78), Repelita m (FY 1979-83), Repelita IV (FY 1984^-88), Repelita V 
(FY 1989-93), and Repelita VI (FY 1994-98). 

rupiah (Rp) — Basic unit of currency. The exchange rate was fixed at Rp415 
to US$1 from 1971 to 1978, when the rupiah was devalued to Rp625. 



409 



Indonesia: A Country Study 

Following two devaluations in 1983 and 1986, the rupiah was gradually 
depreciated at an average rate of about 5 percent per year up to the 
financial crisis in 1997-98, when the Indonesian currency was floated, 
and the exchange rate fell dramatically. During the recovery after the 
crisis, the rupiah stabilized at a level of about Rp 11,000-12,000 per 
US$ 1 , and in the early twenty-first century it improved to about Rp8,000- 
9,000 per US$ 1 . At the end of July 20 1 1 , the interbank exchange rate was 
valued at Rp8,481.76 per US$1, or Rpl = US$0.00012. The rupiah is 
issued in 1, 25, 50, 100, 200, 500, and 1,000 coins and 1,000, 5, 000, 
10,000, 20,000, 50,000, and 100,000 notes. 

santri — Orthodox Muslims. In the Javanese context, the santri are also 
sometimes referred to as putihan (white ones), an allusion to their 
purity, especially as contrasted to abangan (q.v.) in Javanese. 

sharia (Arabic; syariah in Bahasa Indonesia, q.v.) — Islamic canon law. 
Among Shia (q.v.) Muslims, the sharia includes the Quran and the 
authenticated sayings of the Prophet ihadith) and the Twelve Imams. 

Shia (or Shiite) — A member of the smaller of two great divisions of Islam. 
The Shias supported the claims of Ali and his line to presumptive right 
to the caliphate and leadership of the Muslim community, and on this 
issue they divided from the Sunnis (q.v.) in the first great schism of 
Islam. Later disagreements have produced further schisms among the 
Shias. Shias revere 12 imams, most of whom are believed to be hidden 
from view. 

Sufi — From suf, the Arabic word for "wool." The term derives from the 
practice of wearing a woolen robe, a sign of dedicating oneself to the 
mystical life, known in Islam as becoming a Sufi. Sufis, who seek 
mystical union with God, have been condemned by some Sunni (q.v.) 
legal schools. 

Sunni — From the Arabic sunna meaning "custom," with the connotation of 
orthodoxy or tradition based on the Prophet Muhammad's example. One 
of the two great divisions of Islam, the Sunnis supported the traditional 
method of election to the caliphate and accepted the Umayyad line. On 
this issue, they divided from the Shia {q.v.) discipline in the first great 
schism within Islam. 

Supersemar (Surat Perintah Sebelas Maret) — The Letter of Instruction of 
March 11, 1966, in which Sukarno signed over his executive authority, 
in the wake of the September 30, 1965, coup attempt, to General Suharto. 

Transmigration Program — A voluntary rural resettlement plan that sought 
to move large numbers of Javanese to Indonesia's underpopulated 
Outer Islands (q.v); transmigrasi in Bahasa Indonesia (q.v.). 



410 



Glossary 



wayang (theater) — A dramatic form in several major variations, in which 
puppets or human performers portray gods, heroes, villains, and other 
characters in literary epics. The wayang kulit is shadow theater using 
highly decorated flat leather puppets. 

World Trade Organization (WTO) — Established in 1994 as successor to 
the General Agreement on Tariffs and Trade (GATT) and effective 
from January 1, 1995, the WTO has the goal to provide a forum to 
resolve trade conflicts between members and to carry on negotiations 
with the goal of further lowering and/or eliminating tariffs and other 
trade barriers. The WTO has 153 members, including Indonesia, and 
30 observers. 



411 



Index 



abangan (nominal Muslim), 120, 259 
Abdalla, Ulil Abshar, 282 
Abdulgani, Ruslan, 74 
Abdullah, Baginda Dahlan, 45 
Abu Sayyaf, 1 

Aceh, preindependence, 21-23, 33, 81 

Aceh, Special Region of, 65, 81, 86, 87, 101, 
106, 139, 229, 234, 247-51, 285, 324-26, 
357, 363; Acehnese language and people, 128, 
139-40, 250; agriculture in, 139; elections in, 
251; and Free Aceh Movement (GAM), 81- 
82, 317, 324-26; industry in, 206; Islamic law 
and practice in, 1, li, 65, 139; militant jihadist 
group in, lvii; military forces in, 344; natural 
resources of, 106, 184, 212, 324; and tsunami 
(2004), 89, 106, 215, 251, 279, 31 1, 323 

Aceh Monitoring Mission, 251 

Aceh-Nias Rehabilitation and Reconstruction 
Agency (BRR), 251 

Aceh Referendum Information Center (SIRA), 
249, 251 

Act of Free Choice (1969), 67, 81, 252 

adat (custom or tradition, unwritten), 39, 131- 

32, 140, 141,253 
adat courts, 245 

adat laws (hukum adat), 131, 244-45, 358 
agama (religion or religions), 66, 120-21, 124, 
142 

Agama Hindu (see also Balinese Hinduism), 
123, 143 

agama Jawa (a syncretistic religion), 120 

agama Konghucu (Confucianism), 125 

Agency for the Study and Application of Tech- 
nology (BPPT), 243 

Agrarian Act (1870), 38 

agriculture, 7, 77, 78, 83, 97-98, 104, 144, 145, 
180, 193, 197-99; coffee, 142; in colonial 
period, 34-38; food crops, 138, 139, 140, 142, 
198-200; palm oil, 104, 199-200; rain-fed 
agricultural land (tegalan), 68, 199; rubber, 
61, 201; sugar, 30, 34,199 

Agung, Sultan, of Mataram, 25 

Ahmadiyah, lviii 

Ahtisaari, Martti, 106, 251, 325 

aid, 166, 180, 182, 190-91 

Aidit, D.N. (Dipa Nusantara), 66, 68, 70 



Air Force of the Republic of Indonesia (TNI- 
AU), 347-49; air bases, 349; aircraft and heli- 
copters of, 347-49; Air Materiel Command, 
347; Air Training Command, 347; command 
structure of, 340-4 1 ; East and West Operations 
Commands (Ko-Ops), 341, 347; education in, 
343; materiel, 336; National Air Defense Com- 
mand, 347^18; personnel, 338, 347; ranks and 
uniforms, 350-51, 353; women in, 349 

Airlangga, 12 

airports, 218-19 

Akashi Yasushi, 292 

Aksi Stop AIDS (ASA), 160 

Alatas, Ali, 323 

Albuquerque, Alfonso de, 18 

Ali, Suryadharma, 280 

Alie, Marzuki, liv 

aliran kepercayaan (streams of belief), 45, 1 14, 
264 

All-Indonesian Workers' Union (SPSI), 196 
All-Indonesian Workers' Union Federation (FSPSI), 
196 

Alliance of Independent Journalists, xlix 
Allied forces, 52, 55 
Alor, 122 

Al Qaeda, 88, 227, 280, 324 

"Als ik eens een Nederlander was" (If I were a 

Dutchman), 44 
Alwi, Des, lx 
Amamapare, 214 
Amangkurat I, 26-27 
Ambalat Island, 105 

Ambon, 49, 86, 1 17, 1 18, 284-85, 328, 347 
American Federation of Labor, 194 
Americanization, xlv 
Amnesty International, 107 
Angkola, 140 

animism, 120, 121, 124, 142, 144, 258 
Ansor (Helpers of Muhammad), lix, 68; and 

Detachment 99, lix 
antipornography law (2008), xlix, lv, lvi 
Anwar, Dewi Fortuna, 293 
Anwar, Rosihan, lx 
Aquino, Corazon, 300-301 
Arab Indonesians, 1 15 
Arabian Peninsula, 101 
Arabic, 128, 131, 153 



413 



Indonesia: A Country Study 



archipelagic land and sea space (wawasan 

nusantara), 105, 288 
archipelago (nusantara), 15 
Archipelago Aircraft Industry (IPTN), 173, 

176, 209,337 
Ariel. See Irham, Nazril 
Arifinto, lv 

arisan (credit association), 132 

Armadas. See Navy of the Republic of Indo- 
nesia (TNI-AL) 

Armed Forces Military Academy (Akmil), 
338, 343 

Armed Forces of the Federal Republic of 
Indonesia (APRIS), 312 

Armed Forces of the Philippines, 301 

Armed Forces of the Republic of Indonesia 
(APRI, then ABRI; see also Indonesian Nat- 
ional Armed Forces — TNI), 66, 68, 69-70, 72, 
81, 83, 86, 314, 319, 355; antecedents of, 312; 
and civil conflict, 85; and corruption, 64, 318— 
19; in East Timor, 82, 321; economic role of, 
333; Latihan Gabungan (LatGap exercise), 
335; materiel, 318; and politics, 63-65, 74, 
330; role of, 316, 330-33 

Armed Forces Strategic Intelligence Body 
(Bais), 355 

Army of the Republic of Indonesia (TNI-AD), 
344 45; Army Special Forces Command 
(Kopassus), 330; education in, 338, 343; and 
human rights, 283; materiel, 344-45; person- 
nel, 338, 345; and politics, 282-84; ranks and 
uniforms, 350-51, 353; recruitment, 338-39; 
territorial system, 283, 334, 341^12, 344; 
women in, 349-50 

Army Special Forces Command (Kopassus), 
268, 341, 343; Unit 81, 330 

Army Strategic Reserve Command (Kostrad), 
69, 341 

Asahan Hydroelectric and Aluminum Project, 
207 

asas tunggal (underlying principle), 76, 262 
ASEAN. See Association of Southeast Asian 
Nations 

Asia-Africa Conference (1955), 66-67, 289 

Asian Development Bank, 289 

Asian financial crisis (1997-98), xl, 85, 113, 
115, 133, 150, 165, 174-77, 181-82, 187, 
189, 191, 193, 197, 207, 215-16, 288, 290, 
294, 298,310,318 

Asmat, 147-^8 

as-salaf as salih (Islam of the righteous ances- 
tors), 119 



Association of Southeast Asian Nations 
(ASEAN), 160, 191-92, 251, 288, 290-95, 
297, 299-302, 352; aims and endeavors of, 
290-93, 295; ASEAN Economic Community, 
192, 222, 294; ASEAN Free Trade Area 
(AFTA), 192, 222; ASEAN Plus Three (China, 
Japan, and South Korea), 293, 301; ASEAN 
Regional Forum (ARF), 294, 352; ASEAN 
Security Community, 293; ASEAN Socio-Cul- 
tural Community, 294; Charter, 294; economic 
investment from member countries, lix; Indo- 
nesia as chair, lix; military cooperation, 352; 
Roadmap for Financial and Monetary Integra- 
tion of ASEAN, 294; Summit, First (1976), 
292; Summit, Third (1987), 301; Summit, 
Fourth, (1992), 291, 294 

Astra International, 168, 170, 209 

Asyari, Kiyai Haji Hasyim, 43 

Attorney General's Office (AGO), xlvii, lvi, 
360-61 

Australia, 52, 55, 57, 293; armed forces of, 54; 
and East Timor, 82, 296, 337; embassy of, 
bombing, 280-81, 300; military aid and rela- 
tions with, 228-29, 253, 299-300, 323, 352, 
354, 357; territorial disputes with, 105 

Austria-Hungary, 44 

Austronesian people and languages, 5, 97, 128 
Automated Logistics Management System 

(ALMS), 348 
automotive industry, 209 
avian influenza, 160, 202, 303 
Awaluddin, Hamid, 106 
Azhar, Antasari, xlvii 

Ba'asyir, Abu Bakar, lvii, 88, 275, 280 
babinsa (village NCO), 344 
Babullah, Sultan, of Ternate, 21 
Bachir, Sutrisno, 271 

"Back to Nahdlatul Ulama's Original Program 

of Action of 1926," 272 
Badawi, Abdullah, 299 
Badung, 34 
Bagansiapiapi, 148 

Bahasa Indonesia, 9, 97, 126, 128, 129, 130, 
136, 149, 260 

bajaj (three-wheeled, multipassenger motor- 
cycle), 216 

Bakrie, Aburizal, 266 

Bali, 14, 68, 99, 115, 132, 137, 158, 160, 220, 
363; agriculture on, 138; bombings (2002-5), 
lvii, 88, 90, 117, 137, 154, 227, 280, 290, 300, 
303, 329-30, 357; and population issues, 109; 



414 



Index 



and religion on, 123-24; resistance of, to col- 
onists, 34; tourism on, 137; transport on, 215, 
219 
Bali TV, 220 

balian (shamanic curing), 144 

Balibo Declaration, 321 

Balikpapan, 217 

Balinese Hinduism, 123-24 

Balinese language and people, liii, 128, 131, 

137-38 
Banda Aceh, 250 
Banda Archipelago, 19, 21 
Banda Neira, 48 

Bandung, 66-67, 156, 216, 289, 347 
Bangka,212 
Bangka-Belitung, 212 
Bangkok, 216 

Bangsa Islam Indonesia (Indonesian Nation of 

Islam), 317, 329 
banjar (village compound), 138 
Banjar (ethnic group), 130 
Banjarmasin, 25, 33 
Bank Andromeda, 176 
Bank Bali, 179 
Bank Century, xlvii 
Bank Duta, 170 

Bank Indonesia, xlii, xlvi, 166, 170, 173, 174, 

179, 185-88, 247 
Bank Mandiri, 177 
Bank Summa, 170 
banking system, 169-72, 174-78 
Bantam, 49 

Banten, lviii, 18, 21, 25, 130, 356 
banua (ordinary house), 143 
bapak (father or elder), 128, 258 
Bappenas. See National Development Plan- 
ning Board 

Barisan Hisbullah (Army of God; see also 

Hezbollah), 52 
Bashir, Abu Bakar. See Ba'asyir, Abu Bakar 
Batak, people and language, 128, 140, 252 
Batam, 207, 209 
Batavia. See Jakarta 
batig slot (budgetary surplus), 36 
batik, liii 

Battle of the Java Sea (1942), 49 

Baturaja, 345 

Baud, Jean Chretien, 31 

bauxite, 210, 214 

Beatles, the, 66 

becak (pedicab), 2 1 5-16 

Beijing, 301-2 



Bekasi (see also Jabodetabek), lviii, 1 12, 194 

Belawan,217 

Belgium, 57 

Belitung, 91, 212 

Bellwood, Peter, 6 

Bemo, 216 

"Bengawan Solo," liii 

Bengkulu, 48, 140 

Benteng (Fortress) Program, 62 

Berita Buana, 287 

"Berkeley Mafia," 166, 167 

Betawi, 130 

Beureueh, Muhammad Daud, 81 
Bhagavad Gita, 123 

Bhinneka Tunggal Ika (Unity in Diversity), 

15, 132,233 
bhumi (land or realm), 1 1 
Biak,219, 346 
Bima, lvii 

Bimantara Citra Group, 169 
Bintan Island, 207,214 
bintang (star), 272 
BintuniBay,212, 328 
birthrate, 83, 107 

"Black Friday" {see also terrorism), 1 
Blackberry, lv 
Blackwood, Evelyn, 141 
Blambangan, 25 
Blasphemy Law (1965), li 
Blitar, 72 

Boediono. See Budiono 
Bogor,72, 102, 112, 156, 194 
Bolivia, 212 

Bone {see also Buginese people and language), 
24 

Bontang, 212 
book banning, lvi 

Borneo (see also Kalimantan), 53, 68, 99 

Borobudur, 9, 13, 126 

Bosch, Johannes van den, 34-35 

Bosnia-Herzegovina, 352 

Boven Digul, 46, 48 

BP Tangguh natural gas field, 328 

brahmana (Brahman priests and class; see also 

Hinduism), 124, 137 
Brantas Lapindo, Hi 
Brantas River, 12 
Brazil, xl 

Brenner, Suzanne, 1 1 1 

Britain, 29, 68, 323, 345, 347, 352, 354 

British troops, 54, 55-56 

"Broad Outlines of State Policy," 241 



415 



Indonesia: A Country Study 



"Broad Policy Outlines and Implementation 
Plans for Political and Economic Stability" 
(1966), 73 

Brunei, 99, 290 

buaya (crocodile), xlviii 

budaya (culture), 132 

Buddhism, 8-9, 16-18, 25, 118, 125-26; Bud- 
dhayana, 126; Kasogatan, 126; Mahayana, 9, 
126; Maitreya, 126; Nichiren, 126; Theravada, 
126; Tridharma, 126 

budget {see also defense spending), 180-83, 
185-88,221,240 

Budiono, xlii, xlvi, xlvii, 177, 182, 242, 256, 
278 

Budi Utomo (Noble Endeavor), 43, 44, 46 
Buginese people and language, 24, 128, 130, 
252 

Bukittinggi, 50 

Bumi Manusia (This Earth of Mankind), 41 
bupati (district administrative heads, or regents), 

185,228,247-48,251,264 
Bureau of Public Works, 38 
Burma (Myanmar), 50, 61, 101, 229, 290, 

312, 336, 363 
bus transport, 114 

Bush, George W., 290, 300, 301, 303-4 
business conglomerates, 169-70, 172-73, 175, 
204-5 

cabinet, 242-^13 

Cakrabirawa Presidential Guard, 69 

California Texas Oil Company (Caltex), 21 1 

Calvinism, 122, 146 

camat (head of subdistrict), 247 

Cambodia {see also Khmers), 11, 14, 290, 

293, 321; peace process, 292, 302, 303, 352; 

Vietnamese invasion of, 292, 335 
candi (stone structures), 9 
Cantonese, 148 
Cape York Peninsula, 300 
Capital Investment Coordinating Board 

(BKPM), 167, 243 
CASA-235, 344 
castes (varna), 124 
Catholic Party (Partai Katolik), 266 
Catholic University, 156 
Catur Veda, 123 
Celebes Sea. See Sulawesi Sea 
CEMEX (formerly Cementos Mexicanos), 

178 

censorship. See media, censorship of 
Center of the People's Power (Putera), 5 1 



Central National Committee (KNIP), 54, 56, 

57 

Central Statistical Office (BPS), 97, 193, 197, 
198 

Cepu oil field, 211 

Cessation of Hostilities Agreement (COHA, 

2002), 106,250,324 
Cham, 17 
Chavez, Hugo, 284 
chemical products, 168, 206 
Chevron, liv 

Chiang Mai Initiative, 294 
chief of the general staff (Kasum), 341 
chiefs {datu), 8 
children. See family life 
China, 14, 16; influence of, 7; relations with, 
8, 10 

China, People's Republic of, 63, 64, 72, 78, 293; 
competition with, xl, 189; exports to, 191-92, 
301; imports from, 191-92, 337; relations with, 
67-68, 290, 301-2, 335; territorial disputes 
with, 335 

Chinese {Tionghoa), 148 

Chinese Indonesians, 85, 115, 148-50, 205, 302, 
328; in business, 128, 168-69, 173, 318; dis- 
crimination against, 62, 71, 86, 317-18; and 
politics, 270; and religion, 122-23, 125-26; 
wealth of, 196, 257 

Chinese people and languages, 17, 30, 39, 46, 
55, 128, 148,317 

Christianity {see also Protestantism; Roman 
Catholic Church), 18, 39, 118, 121-23, 140, 
142, 143, 146, 148, 149, 273, 281; and poli- 
tics, 269, 270; and religious tensions, 284-85, 
328-29 

Chuo Sangi-In (Central Advisory Council), 51 

cicak (house lizard), xlviii 

Cikampek, 216 

Cikarang,216 

Cilacap, 217 

Cilegon, 169 

Cimareme, Garut, 45 

cinema, 129-30 

Cirebon, lvii, lix, 49 

civil emergencies, 328 

civil society, 115-17,285 

climate, 102-4 

Clinton, Hillary R, 303 

Clinton, William J., 176 

clothing, 129 

cloves trade, 6, 19, 21, 24, 173, 206 
coal industry, 212 



416 



Index 



Cockroach Opera, 85 
Code of Criminal Law (1946), 359 
Code of Criminal Procedures (1981), li, 244, 
360-62 

Coen, J. P. (Jan Pieterzoon), 25 

coffee, 24, 30, 34, 82, 142, 145, 201, 321 

Cokroaminoto, Haji Umar Said (H. U. S.), 43, 

46, 57 
Cola, 12 

Cold War, 58, 66-67, 72, 83, 293, 302 

Commando Jihad. See Komando Jihad 

Commission for the Oversight of Business 
Competition (KPPU), 298 

Commission to Investigate Preparatory Mea- 
sures for Independence (BPUPK), 52, 65 

Commission to Investigate Public Officials' 
Wealth, 359 

Committee for the Preparation of the Constitu- 
tion of the Unitary State, 232 

Committee of Good Offices, 57 

communal violence, 284-85, 318 

communism {komunisme; see also Indone- 
sian Communist Party— PKI), 40, 66, 71, 
75, 84, 124, 142, 291,314, 321 

Communist Association of the Indies (PKH; 
see also Indonesian Communist Party), 43 

Confrontation (Konfrontasi), 68, 289, 291, 
299,315,356 

Confucianism (agama Konghucu), 125, 126 

conglomerates. See business conglomerates 

Congo, Democratic Republic of (former 
Zaire), 290, 352 

Constituent Assembly (Konstituante), 65, 232 

constitution (1945), 53, 62, 65, 88, 231-33, 244, 
260; as amended (1999-2002), 88, 230, 281, 
286, 338; Fourth Amendment (2002), 243 

constitution (1950), 62-63, 231-32 

Constitutional Court, xlvi, li, lii, lvi, 88, 235, 
238, 240, 244, 264, 281,286 

constitutional reform, 227, 247, 257, 273, 281, 
305, 320 

Consultative Council of Indonesian Muslims 
(Masyumi), 52, 63, 64, 254, 259, 272 

Consultative Group on Indonesia (CGI), 191, 
288-89 

copper mining, 214 

corruption, xlvi-xlviii, liv, 61, 62, 84, 150, 172, 
204-5, 221, 228, 231, 246, 304-5, 362; in 
armed forces, 64, 283, 310, 319, 333-34; in 
bureaucracy, 79, 175-76, 253; in business, 79, 
87; in colonial period, 36; fight against, 179, 



274; injudicial system, 178, 244-45, 358; in 

police, 333; in politics, 76, 279 
Corruption Crimes Court (Tipikor Court), 

xlvi,xlvii, 179, 246,359 
Corruption Eradication Commission (KPK), 

xlvi-xlvii, liv, 179 
Council of Generals, 69 
counterterrorism (see also National Police of 

Indonesia— Polri; terrorism), 229, 303, 329- 

30, 355-57 

coups d'etat: attempted (1948), 58, 313; 

attempted (1965), 69-72, 122, 125, 142, 143, 

301, 315, 341, 347; attempted (1998), 268 
court system, 244 46, 358, 361-62; corruption 

in the, 79, 118,244-^15,358 
court, royal (kedatuan, keratuan, or keraton), 

11 

Cribb, Robert B., 71 

crime (see also corruption), 30, 61, 111, 118, 

358, 359; crime rate, 359 
Crime Investigation Agency (Bareskrim), 

xlviii 

Criminal Code. See Code of Criminal Law 
(1946); Code of Criminal Procedures (1981) 

criminal justice system (see also court system), 
358-63 

Crisis Management Initiative (CMI), 251, 325 
cukong (Chinese capitalists), 3 1 8 
Cultivation System (Cultuurstelsel), 34-39 
"culture wars," liii 

currency (see also rupiah), 16, 25, 57, 170, 
174-75, 186, 187, 189; board on, 176; inter- 
national deposits of, 1 86 

custom, unwritten (adat), 39, 131-32, 140, 
141,253 

customary law (adat), 131, 244-45, 358 

dadia (patrilineal descent group), 138 
Daendels, Herman Willem, 29-30 
daerah (region), 184, 247 
daerah istimewa (special region), 247 
daerah khusus (capital-city region), 247 
Dahara, Radhas Panca, lvi 
Dahlan, Kiyai Haji Muhammad, 43 
dakwah (vigorous promotion of Islam), 259, 
262 

dalang (puppet master), 73 
dangdut (a pop music style), 84 
Danish Embassy (Jakarta), 1 
Daoism (or Taoism), 125, 126, 142 
Darul Islam (House of Islam), 58, 65, 81, 1 19, 
234, 250, 261,314,317, 329 



417 



Indonesia: A Country Study 



datu (chief, chiefs), 8 

Dayak people, 144-45, 254, 328 

death, causes of, 159-60 

debt, 175-77, 182-83, 186; foreign, 77, 166, 

175, 182, 190 
decentralization, xl, 86, 88, 1 1 1, 1 12, 151, 165, 

178, 181, 183-85, 194, 205, 228, 248, 255, 

281,305 
Decentralization Law (2001), 88 
Decree No. 1 (1965), 69 
Defenders of the Fatherland (Peta), 51, 312 
defense industries, 337 
defense spending, 310, 318, 332, 335-37 
deforestation, lii, 105, 204-5 
deliberation with consensus (musyawarah 

mufakat), 64, 133 
Demak, 18 

Democracy Renewal Party (PDP), 267 
Democrat Party (PD), xlvi, liv, 89, 242, 256, 

263, 267-68, 278 
Democratic People's Party (PRD), 254 
Democratic Republic of Germany. See East 

Germany 

Democratic Republic of Timor-Leste. See 

Timor-Leste 
Denpasar,219,220 

Department of Communications and Informa- 
tion, xlix, lv 

Department of Defense (Dephan), 319-20, 
339; budget of, 310, 318; personnel of, 339; 
structure of, 320 

Department of Defense and Security (Han- 
kam),319,336 

Department of Finance, 178 

Department of Forestry, 204 

Department of Health, 157, 159-60 

Department of Home Affairs, li, 235, 247 

Department of Industry, 167 

Department of Information, 287 

Department of Justice and Human Rights, lvi, 
245, 360; Department of Corrections, 362 

Department of National Education (Depdik- 
nas), 150, 152 

Department of Religion. See Department of Reli- 
gious Affairs 

Department of Religious Affairs, 123, 124, 
142, 150 

Department of Transport, 216 

Depok, 112, 194, 274 

desa (villages), 132 

Desawarnana [Nagarakertagama], 15 

Detachment 88, lix, 329, 357 



Detachment 99, lix 

Development Unity Party (PPP), 75, 256, 262, 

263,267, 271-73,278-81 
Dewantara, Ki Hajar (Raden Mas Suwardi 

Suryaningrat), 44-45, 48 
dewaprabu (god-king), 14 
Dhani, Omar, 69, 347 
Dieng temples, 13 
Dili, 82, 190, 300, 304, 322 
Dimara, Johannes Abraham, lvii 
Diponegoro, Prince, 30-31, 33, 48 
Directorate General of Radio, Television, and 

Film, 287 
Discovery Channel, liii 
district chiefs, hereditary (uleebalang), 22, 33 
district courts and governance, 245, 247-49 
Dominicans, 122 
Dong Son, 6 

Douwes Dekker, Eduard (Multatuli), 35, 44 
Douwes Dekker, Ernest Francois Eugene (E. 

F. E.), 44 
Douwes Dekker, Jan, 44 
drugs, illegal, 333, 363 
Duaji, Susno, xlviii, liv 
dukun (traditional healer or healers), 121, 137, 

159 
Dulmatin, 1 
Dumai, 217 
Dutch Antilles, 56 

Dutch colonial period, 20-27, 46-49, 122, 147, 
149, 158, 321; conclusion of, 54-60, 229, 
312,315 

Dutch guilders, 36 

Dutch language, 42 

Dutch laws, 244-45, 358, 360 

Dutch people, 33, 62 

Dutch-Native Schools (HIS), 42 

Dutch New Guinea, 25 1 

Dutch Reformed Church, 122 

Dutch Rhenish Mission, 122 

dwifungsi (dual function), xli, 73, 76, 309, 313, 
316, 320, 329 

earliest habitation, 3-6 

earthquakes, lii, lx, 101, 106, 279 

East Asian Miracle, The, 174 

East Germany, 336, 345 

East India Company, 23, 25, 29 

East Indies. See Netherlands East Indies 

East Indonesia, 64 

East Javanese kingdoms, 10 



418 



Index 



East Timor {see also Timor-Leste), xl, xlii, 
82-83, 86, 99, 105, 249-50, 255, 268, 295- 
96, 300, 304, 310, 321-23, 337, 343, 344, 
352, 354, 357 

East Timorese, 105, 295-96, 300 

Easter Island, 128 

Eastern Europe, 337 

Eastern Fleet. See Navy of the Republic of 
Indonesia (TNI-AL) 

economic development (pembangunan), 72, 
73, 76, 78, 165, 167 

economic reforms, 165, 172, 177-80 

economy {see also Asian financial crisis), lix, 
61-62, 68, 73, 83, 85, 87; Chinese in, 16-19, 
30, 39, 43, 149; in the Dutch colony, 30, 34- 
38; early commerce in the, 19, 21-22; govern- 
ment intervention in, 165, 166-67; growth in, 
77; at independence, 60; in the Japanese occu- 
pation, 50, 52; role of armed forces in, 310, 
332-34; the VOC in the, 23-30 

Ecstasy, 363 

education, 98, 150-56, 240, 305; availability of, 
152-53; in colonial period, 41-43, 51, 60; 
expenditure, 150, 180, 183; of girls, 151; 
higher, 154-56; Islamic, 150-51, 153-54; in 
kindergarten, 152; and literacy, 60, 150; policy, 
80; primary, 150-53; secondary, 151-53; and 
teachers, 151-52; vocational, 151 

Effendi, Sofian, 330 

eight-year development plan (1959), 166 
El Nino, 199 

election laws, 264, 272, 275, 278 
Election Oversight Commission (Panwaslu), 
279 

elections, xlii, xliii, xlvi, 73, 80, 230, 234, 259, 
264, 266-79, 305; in 1955, 60, 63; in 1971, 
75; in 1992, 266-67; in 1999, 86, 275-76; in 
2004, 89, 255, 269, 277-78; in 2009, 256, 
267-68, 276-77; local, 248, 251, 255, 275 

electric power, 220-21 

Elson, Robert E., 44 

Emmerson, Donald K., 76, 288 

employment patterns, 193, 198, 206, 209-10, 
215 

Ende, 48 

Eng, Pierre van der, 77 

environmental concerns {see also deforesta- 
tion), 104-5, 214, 326; air pollution, 104; pre- 
independence, 23, 25; water pollution, 104, 
107 

Ertsberg Mountain, 214 
Estrada, Joseph, 301 



Ethical Policy, 38-39 
Ethicists, 38-39, 41 

ethnic groups and languages, 127, 130-50, 159, 
257; Balinese, 137-38; Chinese, 148-50; 
conflict among, 83; Javanese, 130, 132-37, 
257-58; Madurese, 130; Malay, 130; of 
minorities, 142-50; Sumatran, 139-42; Sun- 
danese, 130 

ethnic tensions, xl, 284-85, 317, 328-29 

Eurasians, 33, 40, 43, 46-47, 55 

Europe, 19 

European Union (EU), 25 1 ; relations with, 82, 

207, 337; trade with, 191 
Europeans, 30, 39-41 
exclusive economic zone, 99, 202 
executive branch, 241—43 
exports, 64, 174, 180, 186-89, 191-92, 199- 

201,206,210-12 

Facebook, xlviii, xlix 

Family Health International, 160 

family life, 109-10, 133-34, 159; on Bah, 138; 

on Kalimantan, 144; on Sulawesi, 142-43; 

on Sumatra, 139, 140 
family planning, 83, 98, 109, 180 
Far Eastern Economic Review, 173 
Fasseur, Cees, 39 
Fatu Sinai (Pulau Batek), 105 
Fealy, Greg, 119 

Federal Republic of Germany. See Germany, 

Federal Republic of 
Federal Republic of Indonesia (RIS), 59-60, 

62, 231,247 
federalism, 56, 59, 80, 232, 234, 247^8 
Federation of Malaysia. See Malaysia, Federal 

Republic of 
"50 percent + 1 democracy," xli, 63 
Finance Audit Board (BPK), 238, 246 
financial crisis. See Asian financial crisis 

(1997-98) 
Finland, 325 
fiscal year, 1 80 

fishing industry, 98, 202-4, 346 
five-year plan. See Repelita 
Flores, 34, 122 
Foja Mountains, lii 
food {see also nutrition), 129 
food processing, 165 
Ford Foundation, 159 
Ford Motor Company, liv 
foreign direct investment (FDI), 206-7, 209, 
212,214, 302, 304 



419 



Indonesia: A Country Study 



Foreign Military Financing. See United States 
Foreign Military Financing (FMF) 

foreign reserves, 61 

forest fires, 205, 279, 299 

Forest Watch Indonesia, 204 

forestry {see also deforestation), 98, 104, 147— 
48, 204-5; illegal, 333 

Fort Benning, 303 

Fort Leavenworth, 303 

France, 352, 354 

Free Aceh Movement (GAM), liii, 81-82, 87, 
89, 106, 139^10, 250-51, 263, 317, 324-26 

"free-fight liberalism," xli 

Free Papua Organization (OPM), 81, 87, 106, 
148, 252, 297,317, 326-28 

Freeport-McMoRan Copper and Gold, 81, 
213-14, 327-28 

Fretilin. See Revolutionary Front for an Inde- 
pendent East Timor 

Friend, Theodore, 72 

Front Pembela Islam. See Islamic Defenders' 
Front 

Gadjah Mada University. See Universitas 

Gadjah Mada 
GajahMada, 14, 15 
gamelan, 135, 136 
Garuda, 233 

Garuda Indonesia, 219,317 

Garut-Tasikmalaya region, 57 

gas, natural, 78, 81, 165, 173, 212; liquefied 

(LNG), 173, 191,206,212 
gas industry taxes, 181 
Gatra, 288 

General Elections Commission (KPU), xlvi, 

246-47, 275-76 
gengsi (status), 1 14 

gerakan (movement or movements), 1 16 
gerilya (guerrilla war), 58-59, 64-65, 313, 
321 

Gerindra Party (Great Indonesia Movement 

Party), 256, 268, 278, 280 
Germany, Democratic Republic of (DDR; 

East Germany), 336, 345 
Germany, Federal Republic of, 345, 354 
Gesang, liii 

Gestapu (September 30 Movement), 69-72, 
315 

Gini index, liii, 78, 1 15, 196-97 
Giyugun, 312 
Global FM Bali, 220 
Global TV, 220 



"global war on terrorism," 88, 301 

gold mining, 210, 213-14 

"The Golden Girls," xlv 

"Golden Triangle," 363 

Golkar Party, xlvi, 1, 242, 255-56, 263, 264- 
66, 267, 272, 278-79 

Golongan Karya (Golkar — functional groups), 
64, 74, 75, 264 

gotong royong (politics of mutual coopera- 
tion), 64, 260 

Gowa, 24 

Grasberg Mountain mine, 214 
Great Depression, 40 

Great Indonesia Movement Party (Gerindra 

Party), 256, 268, 278, 280 
Greater East Asia Co-Prosperity Sphere, 50 
Greater Indonesia, 53 
Greater Sunda Islands, 99 
Green Revolution, 199 
Greenwich Mean Time (GMT), 103 
gross domestic product (GDP), liii, 61, 77, 158, 

165, 167, 176-77, 181-82, 184; agriculture 

in, 193, 198; exports and, 188; industry in, 

205-6 

gross national product (GNP), 61, 332 
guerrilla warfare, 58-59, 64-65, 3 13, 321, 325, 
327, 334 

Guided Democracy {demokrasi kerpimpin), 
xli, 63-66, 71, 73, 230, 232, 244, 265, 314 

Guided Economy, 66, 166-67 

Guide to Realizing and Experiencing the Pan- 
casila (P4), 75 

Guinness, Patrick, 132 

Gujarat, 16 

Gumelar, Agum, 278 

Gunung Kawi (Mount Kawi), 12 

Gunung Merapi (Mount Merapi), 9, 99 

Gunung Tambora, 101 

Gus Dur. See Wahid, Abdurrahman 

Gusmao, Jose Alexandre (Xanana), 82 

gusti-kawula (lord-subject), 258 

Guyana: passports, liv 

H1N1 pandemic influenza, 160 
H5N1 avian influenza, 160, 202, 303 
Habibie, Bacharuddin Jusuf (B. J.), 83, 85, 86, 
167, 173, 176-79, 183, 209, 241-42, 247, 
249-50, 268, 275, 286, 295, 310, 320, 322, 
336-37 
/zacfo (hadith), 120 
Hadiz,Vedi, 115 
Hague, The, 45, 48, 58, 59 



420 



Index 



hajj, 136 
Hakka, 148 

Halim Perdanakusuma Military Air Base, 69 
Halmahera, 19, 52, 117, 118, 128 
Hamengkubuwono X, Sultan, 249 
Hamzah, Chandra, xlvii 
Hanoi, 292 

Hanura Party (People's Conscience Party), 

256, 267, 268, 278, 280 
Harian Rakjat, 70 
Harimurti, Agus, 290 

Harjoyudanto, Sigit. See Suharto, Sigit Har- 

joyudanto 
Harsono, Yuli, 1 
Hartarto, 167 
Harymurti, Bambang, 287 
Hasanuddin Air Base, 349 
Hatley, Barbara, 84 

Hatta, Mohammad, lx, 47, 51, 53, 312; arrested, 
48; as vice president, 54, 56, 58, 66 

Hawk Television Indonesia (RCTI), 220, 287 

Hawkins, Mary, 132 

Hayam Wuruk (Rajasanagara), 14, 15 

Haz, Hamzah, 89, 278, 280 

health care, 156-61; challenges in, 159-61; 
government support for, 158, 180, 183; phar- 
maceuticals in, 160-61; resource distribution 
and, 157-58; sanitation and, 159; traditional, 
159 

Heeren XVII (Seventeen Gentlemen), 23 

Hefner, Robert, 124 

Heider, Karl, 130 

heiho (military auxiliaries), 312 

heliports, 219 

Helsinki, 325-26 

Henri Dunant Centre for Humanitarian Dia- 
logue, 250 
Heroes' Day (November 10), 56 
Heryanto, Ariel, xlv 

Hezbollah (Party of God; see also Barisan 

Hisbullah), 229, 290 
Hill, David T., 116 
Hill, Hal, 206 

Hindu-Buddhist kingdoms, state cults, 8, 15, 
16-18,25 

Hindu Dharma (Principles of Hinduism), 123 
Hinduism, 8, 118, 123-25, 142; on Bali, 123- 

24, 137; on Java, Shivaist, 9; temples of, 9, 

13; varieties of, 143, 144 
Hinduization, 7 
Hirata, Andrea, 91 
Hiroshima, 53 



Hitler, Adolf, 49 

Hitu, 24 

Hoamoal, 24 

Hokkien, 148 

Hollandia (Jayapura), 52 

hominids, 4-5 

homo erectus, 4 

Hong Kong, 174, 207, 301 

House of Representatives. See People's Rep- 
resentative Council (DPR) 

Howard, John, 300 

hukum adat (adat laws), 131 

human immunodeficiency virus/acquired im- 
mune deficiency syndrome (HIV/AIDS), 1 59- 
60 

human rights, xliv, li, 88, 90, 252, 255, 268, 
283, 286, 303^, 310, 317, 319, 322, 325, 
328, 337, 352 

Hutomo Mandala Putra. See Suharto, Tommy 

ibu (mother), 128 

ijma (consensus of local Islamic jurispru- 
dence), 120 
ijtihad (exegesis), 282 
"I Love Lucy," xlv 

imports, 61-62, 168-69, 189, 191-92,211 
income, 194-97; distribution, 196-97; per 
capita, hi 

independence, 53-54, 233, 312; declared, 3, 
53, 54; expectations of 60-61, 62, 66; move- 
ment, 46-48,51-53 

Independence Day, 1, 69, 288 

Independence Preparatory Committee, 23 1 

independent state institutions, 246-47 

India, xl, 54, 78, 293; influence of, 7; trade 
with, 191 

Indian Ocean, 16, 101, 128 

Indianization, 7, 229 

Indie concepts, 7, 9, 1 1 

Indies (Indische in Dutch) culture, 40 

Indies Association (Indische Vereniging), 45, 
47 

Indies Party (Indische Partij), 44 
Indies Social-Democratic Association (ISDV), 
43 

indigo, 34 

Indonesia, as name and idea, 44 
Indonesia Menggugat! (Indonesia Accuses!), 
46 

Indonesia merdeka (free Indonesia), 49 
"Indonesia Raya" (Great Indonesia), 50 
Indonesia Stock Exchange, 172 



421 



Indonesia: A Country Study 



Indonesian Association (Indonesische Ver- 

eeniging), 45 
Indonesian Bank Restnicturing Agency (IBRA, 

orBPPN), 177-78 
Indonesian Christian Party (Parkindo), 266 
Indonesian Communist Party (PKI), 43, 45, 58, 64, 

66-69, 114, 254, 263, 265, 291, 301, 313-15, 

347; actions against, 70-72, 232, 259; in armed 

forces, 69; in elections, 63; Special Bureau of, 

70; support for, 230 
Indonesian Debt Reslmcturing Agency 

(Indra), 177 
Indonesian Defense University, 344 
Indonesian Democracy Party (PDI), 75, 266- 

67 

Indonesian Democracy Party-Struggle (PDI- 
P), 242, 254-56, 263, 264, 266-67, 269, 
278-80 

Indonesian Forum for Environment, 204 
Indonesian identity, 3-4, 46-47, 52, 60, 66, 

73, 80, 98, 110-11, 130-32 
Indonesian Independence Preparatory Com- 
mittee (PPKI), 53, 65 
Indonesian Islamic Union Party (PSII), 63 
Indonesian Islamic Warriors' Council (Majelis 

Mujahidin Indonesia), 1 19 
Indonesian Justice and Unity Party (PKPI), 
278 

Indonesian Muslim Intellectuals' Association 
(ICMI), 265-66 

Indonesian Nation of Islam (Bangsa Islam 
Indonesia), 317 

Indonesian National Armed Forces (TNI; see 
also Armed Forces of the Republic of Indone- 
sia — ABRI; Department of Defense — Dephan; 
and individual service branches), 56, 57-60, 
86, 243, 309, 312, 319, 328, 333-35, 344-50, 
363-64; business activities of, 310, 332-33, 
334; chain of command, 340-41; and civic 
action, 344; conditions of service, 349; corrup- 
tion in, 333-34; education and training in, 343- 
44; funding for, 318-19, 333; materiel, 336-37, 
344-45; and military courts, 246, 362; person- 
nel, 338-39, 344, 350-51, 353; readiness, 336- 
37, 347; reforms of, 310, 320-21; and political 
influence, 282-84; women in, 349-50 

Indonesian National Shipping Company 
(Pelni),217 

Indonesian Nationalist Party (PNI), 46-48, 63, 
75, 265, 266 

Indonesian Naval Hydro-Oceanographic Office, 
98 



Indonesian People's Bank (BRI), 166 
Indonesian Prosperous Workers' Union (SBSI), 
196 

Indonesian socialism, 66 
"Indonesianization," 62, 252, 297 
Indosat, 298 
Indosiar, 220 

Indrawati, Sri Mulyani, xlvii 

industry, 77, 205-10; development of, 79, 205, 
210; distribution of, 208; employment in, 209; 
government enterprises in, 206, 207, 212-14; 
import-substitution, 168-69, 172, 205; small- 
scale, 209-10 

infant mortality, 157 

inflation, 66, 77, 166, 170, 174, 186-87, 194, 
221 

informal sector, 1 1 1, 193, 215 

Information and Electronic Transaction Law 
(2008), liv 

inlanders (indigenous people, natives), 39 

"In Search of a New Path" (1966), 73 

Institut Pertanian Bogor, 156 

Institut Teknologi Bandung, 156 

Inter-Governmental Group on Indonesia 
(IGGI), 72, 190-91,288 

internally displaced persons, 106, 113, 118, 
296, 323 

International Court of Justice, 105 

International Criminal Police Organization 
(Interpol), 363 

International Force in East Timor (INTER- 
FET), 295-96, 300, 323 

International Institute for Management Devel- 
opment, lii 

International Labour Organisation (ILO), 193— 
94, 197 

International Monetary Fund (IMF), 68, 79, 

166, 175-77, 181, 187-88 
Internet, xlviii, xlix, 1, lv, 98, 111, 116, 220, 

296, 

Iran, 81, 229, 290,304,352 

Iraq, 229, 290, 300, 352 

Irham, Nazril (Ariel), xlix, liv-lv 

Irian Jaya. See Papua 

Irian Jaya Barat. See Papua Barat 

irrigation, 10, 11, 38, 138, 145, 198, 199 

Iskandar Muda, Sultan, 22 

Islam (see also sharia), 16-18, 19, 21-22, 29, 46, 
53, 65, 76, 83, 90-91, 118-21, 131, 142; and 
education, 150-51, 153-54, 259; influence of, 
116-17; kebatinan, 120-21, 125; and Pan- 
casila, 261-62; political, 88, 258-60, 268-75, 



422 



Index 



280-82: proselytizing, 22; radical, 117, 119. 

311.317, 323, 328-29; role of, 232, 234, 364; 

Shia, 118-19; Sufism and, 121; Sunni. 118— 

19: traditional. 119 
Islamic Army of Indonesia (TIT), 57 
Islamic Association (Sarekat Islam), 43, 45 
Islamic Association Party of Indonesia (PSII). 

271 

Islamic Defenders' Front (FPI), lvii, lviii, 119, 
281 

Islamic Educational Movement (Perti), 271 
Islamic law (see also sharia), 244-45, 250, 

254, 273,275, 281-82,358 
Islamic State of Indonesia (Nil), 58, 59 
Islamic Trade Association (Sarekat Dagang 

Islam). 43 

Islamic University Student Association (HM), 

265-66 
Islamization. 18. 229 
Isma'il, Nur Mahmudi, 273-75 
Israel, 87, 290 
Iswahyudi Air Base, 349 

Jabodetabek (Jakarta, Bogor. Depok. Tangerang, 

andBekasi), 112, 194. 206 
Jabotabek (Jakarta. Bogor. Tangerang, and 

Bekasi). 194 
Jak TV, 220 

Jakarta, 69-70. 128. 156, 157. 194, 220, 247, 
249, 274-75. 279, 347-48; bombings, 1, 88, 
357; in colonial period. 24, 26, 31, 34; impor- 
tance of, 63, 64, 290; pollution in, 104, 161, 
216; population of, 112-13; Stock Exchange. 
171-72, 329; transport links, 215-19; violence 
in 1 17-18. 227, 268, 280-81, 290, 300, 329 

Jakarta Charter (Piagam Jakarta, June 1945), 
53.65.261,281 

Jakarta Globe, 288 

Jakarta Initiative, 1 77 

Jakarta Message (1992), 290 

Jakarta News, 220 

Jakarta Post, xl, 288 

Jambi (Melayu). 14 

Japan, 9. 41. 174: aid from. 191. 293; exports 
to. 191. 210, 212. 302; imports from. 191. 
302; investment by, 76; relations with, 207, 
302-3 

Japanese Imperial Army, 50, 356; Sixteenth 
Army, 50; Twenty-fifth Army, 50 

Japanese Imperial Navy. 50 

Japanese wartime occupation, 48, 49-53, 133, 
312; conditions under. 61 



Java, 49-52, 54-59, 68, 77, 79, 86, 115, 132, 
151, 158, 257-58, 329; agriculture on, 198- 
200; climate on, 102-3; Dutch expansion on, 
24, 27-29; early records of, 8-18; earthquakes, 
lii, 101; Japanese on, 312; and migration, 148, 
328; minerals on, 212; politics on, 64, 97; pop- 
ulation issues on, 109, 132, 192; religion on, 
120, 122, 124; transport on, 215-19; separat- 
ism on, 57-58, 314; volcanoes on, be, 99, 101 

Java Bank, 185 

Java Sea, 212 

Java War ( 1 825-30), 30-3 1 , 33 

Javanese, 50-51, 126, 129, 257; language, 128, 

134, 136; people, 111, 125, 130, 132-37, 

252, 257 

Javanism (kejawen), 120, 136, 257-58 

Jawa Barat, lviii, 101, 111, 117, 132, 156, 160, 

194, 234, 276 
Jawa Hokokai (Java Service Association), 51, 

54 

Jawa Tengah, lvii, 99, 124, 132, 160, 194, 206, 

211,216, 269, 347 
Jawa Timur, 68, 115, 117, 124, 132, 194, 212, 

216, 269, 347, 349 
Jay, Robert, 132 
Jayakerta, 24 
Jayapura, 52, 253, 327 
Jayawijaya Mountains, 147 
Jemaah Islamiyah (Congregation of Islam), 1, 

lvii, 88, 117, 119, 275, 280, 285, 324, 329- 

30 

Jepara, 206 

Jesuits (Society of Jesus), 122 
Jews, 119, 273 
jihad, 31, 328 

jilbab (woman's head scarf), 1, 1 1 1, 129 
Jinarakkhita, Bhikku Ashin, 126 
JJFM (radio station), 220 
Johor, 298 

Joint Exercise (LatGap), 335 
Jonge, Bonafacius B. de (B. B.), 48 
Joyohadikusumo, Sumitro, 64, 167, 268 
Juanda, 219 

Judicial Commission, 238, 245 

judicial system, 228, 244-46; reform of, lv 

Justice Party (PK), 273-74, 281 

JW Marriott (hotel in Jakarta), 1, 1 1 7, 280-8 1 

kabizu (patrilineal clan), 146 
kabupaten (regency), 1 12, 235, 247^8 
kafir (pagan), 142 
Kaharingan, 124, 144, 146 



423 



Indonesia: A Country Study 



Kahin, George McTurnan, 23 1 
Kahuripan, 12 
Kai Islands, 34 

kakawin (long narrative poem), 12 

Kalimantan (see also Borneo), 86, 97, 99, 104, 
143, 144-45, 215; agriculture on, 144, 199; in 
colonial period, 33; early records of, 8, 12, 14, 
25; and environmental problems, 279; forestry 
on, 204-5; migration to, 144-45, 328; natural 
gas on, 81; oil industry on, 49, 211-12; reli- 
gion on, 122; urbanization on 111; violence 
on, 117, 118, 227 

Kalimantan Barat, 122, 126, 148, 284, 328 

Kalimantan Tengah, 122, 126, 328 

Kalimantan Timur, 105, 113, 158, 184,206,212, 
217 

Kalla, Muhammad Yusuf, xxxix, xlii, xlvi, 

242, 264, 266, 268, 278-79, 285, 329 
Kamaruzaman,"Syam," 70 
kampung (village), 127 
Karimun, 207 
Kara, lx 

KaroBatak, 124, 140 
Kartini, Raden Ajeng (R. A.), 41 
Kartosuwiryo, Sekarmaji Marijan (S. M.), 57- 
58 

kartu tanda penduduk (national identity card), 
110 

Kasogatan Buddhism, 120, 121 

kebatinan (mysticism), 120-21, 125, 258, 259 

kebaya (blouse), 129 

kebudayaan Indonesia (culture of Indonesia), 
132 

kecamatan (subdistrict), 247 
kedatuan, keratuan, or keraton (royal court), 
11 

Kediri, 12, 14, 15, 18 

Kedu Plain, 9 

Keeler, Ward, 133 

kejawen (Javanism), 120, 136, 258 

kemerdekaan (freedom), 45 

Kendari, 49 

Kenpeitai, 50 

kepercayaan (faiths), 120-21 

Kepulauan Riau {see also Riau Archipelago), 

212,214 
keris (asymmetrical dagger), liii 
Kertanagara, 14 

Kertarajasa (reign name of Raden Wijaya), 14 
Khmer Rouge, 302 
Khmers (Cambodians), 292 
Kia, 174 



kiai (Muslim scholar) 120, 121 
Kiemas, Taufik, 267 
klandestin (clandestine apparatus), 322 
Klungkung, 34 

ko or non-A» (cooperative or not), 46 
Koiso Kuniaki, 52 

Komando Jihad (Commando Jihad) 317 

Kompas (Jakarta) 287 

komunisme. See communism 

Konfrontasi. See Confrontation 

Konstituante. See Constituent Assembly 

Ko-Op. See Air Force of the Republic of Indo- 
nesia (TIN-AU) 

Kopassandha. See Army of the Republic of 
Indonesia (TNI-AD) 

Korea, Democratic People's Republic of 
(DPRK, North Korea), 294 

Korea, Republic of (South Korea), lix, 174, 
191, 207, 212, 337, 345, 347, 349 

Korean Peninsula, 229, 290 

Korean War (1950-53), 61 

kota or kotamadya (municipality), 112, 235, 
247^19 

Krakatau, 101 

Krakatau Steel, 169, 173 

kretek cigarettes (clove-scented), 129, 173, 
206 

kraton (royal court), 12, 249 
Kriangsak Chomanan, 292 
krupuk (fried shrimp- or fish-flavored chips), 
129 

Kshatriya (ruler-warrior caste, satriya in Indo- 
nesian), 124, 137 
Kuala Lumpur, 216 
Kudus, 206 

Kuncoro-Yakti, Dorojatun, 177, 182 
Kuta, 137, 154, 280, 329 
Kutai, 8 
Kuwait, 352 

Laakso-Taagepera Index, 254, 263 
labor force (see also employment patterns), 
192-93 

ladang (dryland, nonirrigated), 198 
Lais, Sultan Abu, of Ternate, 21 
Lakalena, Melki, lvi 
Lampung, 201 
Lamreh, 16 

land or realm (bhumi), 1 1 
language, 128-29, 134-36 
Laos, 290, 321,363 
laskar (militia forces), 57, 58, 312 



424 



Index 



Laskar Jihad, 281, 284-85, 328 
Laskar Pelangi (Rainbow Warriors), 9 1 
Law 22 (1999), 183-84 
Law 25 (1999), 183-84 
Lawangan, 144 

League of the Supporters of Indonesian Inde- 
pendence (IPKI). 266 

Leahy Amendment, 304 

Lebanon, 290,318,352 

Leiden. 45 

Leifer, Michael, 289 

Leimena. Johannes, lvii 

lembaga swadaya masyarakat. See nongov- 
ernmental organizations 

Lesser Sunda Islands. See Nusa Tenggara 

Letter of Instruction of March 11 (Supersemar). 
72 

Lev. Daniel S., 232 

Lhokseumawe, 81,212 

Liberal Islam Network (JJX), 282 

Libya, 81. 250 

Liem Sioe Liong, 1 69 

life expectancy, 77, 107, 157 

literacy, 42. 60. 150 

Ligitan Islands, 105 

Linggajati Agreement (1946), 56 

Li Peng. 302 

liquefied natural gas (LGN). See gas, natural 
Lisbon, 321 
livestock, 202 

local government. 184, 247-50. 255 

logging. See forestry 

Lombok, 34, 137 

Lombok Strait. 102 

lower classes, 83. Ill, 114-15, 157 

Lubang Buaya (Crocodile Hole), 69 

Lubis, Zulkifli. 64 

Lumpur Sidoarjo (Lusi) mud volcano, Hi, 101, 

279, 
Lutherans, 122 

Maanyan, 144 

Maarif. Ahmed Syafii. lviii 

Macapagal- Arroyo, Gloria, 301 

Madagascar, 128 

MadiunAffair.58.313 

madrasah (madrassa), 121, 154 

Madura. 14. 25. 56, 99, 109. 130, 215; agricul- 
ture on. 199; migration from, 328 

Madurese people and language, 128, 130, 145, 
284. 328 

Magelang, 338, 343 



Mahabharata (Great Battle of the Descendants 

of Bharata), 124 
Mahayana Buddhism, 9 
Mahmud, Malik, 106 
Mahmud, Sultan, of Melaka, 18 
Maitreya Buddhism, 126 
Majapahit, 14-16, 18,48, 137 
Majapahit Park (Taman Majapahit), 15 
Majelis Mujahidin Indonesia (Indonesian Islamic 

Warriors' Council), 119 
Majelis Permusyawaratan Rakyat — MPR. See 

People's Consultative Assembly 
Makassar (formerly Ujungpandang), 21, 22, 

217,343,347,349 
Makassarese (Gowa), 24, 26 
Malacca, Strait of. See Strait of Malacca 
Malaka, Tan. See Tan Malaka 
Malari riots, 76 
Malay language, 47, 97, 128 
Malay Peninsula, 8, 14, 15, 18, 53, 99 
Malay people, 130, 205, 252, 328 
Malay/Indonesian language, 9, 15, 128 
Malaya, 68 

Malaysia, Federal Republic of, liii, 67, 68, 78, 
99, 101, 158, 161, 174, 201, 212, 219, 279, 
288, 300, 329, 363; Confrontation against, 68, 
291; economy of, hi; Ministry of Tourism of, 
liii; relations with, 72, 105, 298-99, 346 

Malino I (for Poso), 285 

Malino II (for Ambon), 285 

Maluku, lvii, 158, 281, 284, 324, 328-29 

Maluku Islands (or the Moluccas), 6, 12, 14-15, 
19, 24, 34, 49, 52, 60, 86, 99, 346; climate on, 
102-3; language on, 128; religion on, 122; 
violence on, 117, 227 

Manado, 119, 220 

Manado Tua, 103 

Mandailing, 140 

Mandan, Arief Mudatsir, 280 

Mandar, Sultan, of Ternate, 24 

Mangkunegaran, 27 

Mangunkusumo, Cipto, 44 

Manila, 216, 301 

Manipol (Political Manifesto), 65 

Manokwari, 346, 347 

manufacturing, 61, 77, 188-89, 192, 193, 196; 

for export, 206, 207 
Mansur, Sultan, of Tidore, 21 
Marcos, Ferdinand, 300 
Marriott. See JW Marriott 
marga (patrilineal descent group), 140 
marble, 82 



425 



Indonesia: A Country Study 



marhaen (ordinary person), 46 
marijuana, 333, 363 

marine corps (see also Navy of the Republic 

of Indonesia (TNI-AL), 338, 346 
Marshall Plan, 58 

martial law, 64, 87, 106, 232, 250-51, 314, 
324 

Marxism-Leninism, 43, 45, 46, 264 
Mass Guidance System (Bimas), 199 
Mataram, 9-12, 22, 25-28, 31 
Max Havelaar, 36 
"McGyver," xlv 
Mecca, 136 
Medan,217,219, 250 

media, 66, 86, 90, 98, 111, 116, 130, 286-88, 
310, 316, 364; censorship of, xliii, 66, 126, 
309, 321 

Medina Charter, 273 

"Mega-Bintang" campaign, 272 

Megawati. See Sukarnoputri, Megawati 

Melaka (Malacca), 15, 18, 22-23 

Melanesians, 252, 257 

Melayu (Jambi), 14 

Melayu Banjar, 130 

Mentawai Islands, lx 

menyelusuri sejarah (to straighten out history), 
4 

merantau (practice of going away temporarily 

or permanently), 112, 139, 141 
Merauke, 327 
merdeka (freedom), 45, 46 
Merpati Nusantara Airlines, 2 1 9 
Metro TV, 220 

middle classes, xlv, 48, 51, 68, 83-84, 115 
Middle East, 228 

migration, 112-14, 133, 139, 141, 143, 144-45, 

205, 252, 284, 326-27, 328 
Miharja, Akhdiat, lx 

Military District Command (Kodim), 344 

military courts, 246, 361-62 

military law (2004), 320, 339 

military regional commands (Kodams), 283, 

334, 341,344 
Military Resort (or Garrison) Command 

(Korem), 344 
Military Subdistrict Command (Koramil), 344 
militia forces (laskar), 57, 58, 312, 323, 343, 

354 

Milone, Pauline D., 112 
Mimika, 327 

Minahasa Students' Association (Studerende 
Vereniging Minahasa), 44 



Minangkabau, 33, 45, 128; people of, 130, 

140-42 
Mindanao, 301 
Ming Dynasty, 16, 19 
mineral industries, 210-14 
rriining, 148; coal, 212; copper, 214; gold, 213— 

14; illegal, 333; nickel, 214; tin, 212, 214 
Ministry of Colonies (Dutch), 3 1 
Minke, 41 

Misbach, Mohamad (Red Haji), 45 

Mohammad, Gunawan, 78, 282 

Moluccas. See Maluku Islands 

Mongolia, 294 

Mongols, 14, 16 

monsoons, 102-3 

Moody's Corporation, lix 

Mook, Hubertus Johannes van (H. J.), 56 

Morotai, 52 

Mountbatten, Earl Louis, 55 

Mount Kawi (Gunung Kawi), 12 

Mount Merapi (Gunung Merapi), lx, 9, 30, 99 

Mount Sinabung, lx 

Mount Tambora (Gunung Tambora), 101 
MTV Indonesia, 220 
Muhammad (Prophet), 120, 273 
Muhammadiyah (Followers of Muhammad), 

lviii, 43, 48, 51, 91, 116-17, 259, 263, 270, 

282, 286 
Muis, Abdul, 43 

Multatuli. See Douwes Dekker, Eduard 
Mulyani, Sri, xlvii 
Mulyasari, Prita, xlviii-xlix, lv 
municipality {kotamadya or kota), 1 12, 235, 

247^19 
Murtopo, Ali, 74,81 
Musi River, 8 

Muslims (see also Islam), 30, 136; politics of, 45, 
75, 254, 258-60, 268-75; in population, 258; 
and religious tensions, 137, 144, 281, 284-85, 
328 

Muslim Party of Indonesia (PMI), 271-72 
Muso, 58 

musyawarah mufakat (deliberation with con- 
sensus), 64, 133,260 
mutual cooperation (gotong royong), 64, 261 
Muzadi, Hasyim, 278 
Myanmar. See Burma 
Myristicafragrans, 19 

Nagaratertagama [Desawamana], 15 
Nagasaki, 53 



426 



Index 



Nahdlatul Ulama (Council of Scholars; see 
also Ansor), lviii-lix, 43, 51, 63, 68, 71, 86, 
1 16-17, 254, 259, 263, 268-72, 282, 286 

Namaliu, Rabbie, 297 

Namibia, 352 

Nanggroe Aceh Darussalam (NAD; see also 

Aceh, Special Region of), 420 
Napoleon, 29 

Nasution, Abdul Hans, 58, 64, 66, 69, 84, 
313-14 

National Air Defense Command (Kohanud- 
nas; see also Air Force of the Republic of 
Indonesia (TIN-AU), 341 

National Awakening Party (PKB), 117, 255- 
56, 263, 268-70, 272, 278-80 

National Committee for Avian Influenza Con- 
trol and Pandemic Influenza Preparedness 
(Komnas FBPI), 160 

National Day. See Independence Day 

National Defense Institute, 330 

National Development Planning Board (Bap- 
penas), 166, 243 

National Electric Company (PLN), 220 

National Family Planning Coordinating Agency 
(BKKBN), 243 

National Front, 255-56, 279 

National Human Rights Commission, 255 

National Intelligence Agency (BIN), 354-55 

National Intelligence Coordinating Board (Bakin), 
75, 354 

National Logistical Supply Organization, (Bulog), 
199 

National Mandate Party (PAN), 256, 263, 270- 

71,272, 278-80 
national medium-term development plan (NMDP), 

180 

National Police of Indonesia (Polri), 243, 314, 
317, 319, 355-58, 361, 363-64; corruption 
and, xlvii, 79, 333; counterterrorism and, 1-li, 
329, 357; Detachment 88, 357; ethnic vio- 
lence and, 328; Explosive Ordnance Devices 
Unit, 357; Mobile Brigade, 356-57; National 
Police Academy, 357; personnel, 355; Polda 
Metrojaya, 355; Police Command and Staff 
School, 357-58; Regional Police (Polda), 
355-56; Sea and Air Police, 356; training of, 
357-58; women in, 349, 356 

National Resiliency Institute (Lemhanas), 343- 
44 

National Revolution (1945^19), xl, 54-60, 62, 

64,71,73,345,350,356 
National Son Timor (TPN), 174, 176 



nationalism (nasionalisme), 3, 40, 46-49, 51- 

53, 56, 66, 247, 258, 289, 298 
"Nationalism, Islam, and Marxism," 46 
Nationalism and Revolution in Indonesia, 23 1 
nationalization, 62, 332-33 
Natsir, Mohammad, 64 
Natuna Islands, 81, 212, 335, 346, 349; gas 

field in, 81 

Navy of the Republic of Indonesia (TNI-AL; 
see also marine corps), 345^47; command 
structure, 340-41; education and training in, 
343; fleets of, 341, 346; ranks and uniforms, 
350-51, 353; materiel, 336, 345; personnel in, 
338, 346; ships of, 345; women in, 349 

Nazar, Muhammad, 25 1 

Nazaruddin, Muhammad, liv 

Netherlands, 29, 58-60; aid from, 190; as colo- 
nial power, 31^49, 321; debt to, 61; enter- 
prises of, 23, 332; relations with, 67, 309, 337, 
345, 354 

Netherlands East Indies, 23, 30-38, 48, 49, 53 
Netherlands Indies Civil Administration (NICA), 
55 

Netherlands Indies Criminal Code (1918), 359 

Netherlands Trading Association (NHM), 35 

Netherlands-Indonesian Union, 56 

"new emerging forces," 288 

New Guinea, 34, 53, 99 

New Order (see also Suharto), xli, xlii, xliii, xliv, 
liii, lvi, 3, 72-88, 111, 130, 131, 165, 166-69, 
229, 231, 247, 250, 258, 259, 264-65, 275, 284, 
286-88, 3 15-19; characteristics of, 118, 230-31; 
corruption under, 244, 274, 287; economy under, 
77, 206-7, 210; and Pancasila, 261; religion 
under, 1 18, 124-26; resistance to, 286 

New Paradigm (Paradigma Baru), 320 

New People's Army, 301 

newspapers, 287-88 

New Zealand, 352 

Ngaju Dayak, 144 

Ngandong, 4 

NgurahRai,219 

Nias, 101 

Nichiren Buddhism, 126 
nickel mining, 214 
Nielsen Indonesia, 130 
Nigeria, 78 

Nine Saints (wali songo), 17 
Nitisastro, Wijoyo, 77, 166, 167 
Nobel Peace Prize, 251 
Nonaligned Movement, 66-67, 289-90 



427 



Indonesia: A Country Study 



nongovernmental organizations (NGOs; in 
Indonesia, LSM or ornop), 115, 285-86, 299 

Nood Universiteit (Emergency University), 
156 

North Borneo (Sabah), 291, 300 

North Korea. See Korea, Democratic People's 

Republic of 
Nucleus People's Estate (PIR), 201 
Nugraha, Yudhistira Ardhi, 84 
nusantara (archipelago), 15 
Nusa Tenggara (Lesser Sunda Islands), 99, 

103, 122, 128 
Nusa Tenggara Barat, lvii, 101, 157 
Nusa Tenggara Timur, 99, 106, 1 17, 122, 145, 

158, 295-96, 322 
nutmeg, 19, 24 
nutrition, 77 

"100 percent Independence" (Seratus Persen 
Merdeka), 56 

Obama, Barack H., lx, 303-4; "New Begin- 
ning" speech (2009), lx 

oil industry, 49, 61, 78, 82, 143, 148, 165, 167- 
69, 173, 191, 206; pipelines, 212; prices and 
taxes, 1 80-83, 2 1 1 , 22 1 ; production, 210-11 

"old established forces," 288 

Old Order {see also Sukarno), lvi, 72, 81, 231, 
266, 289 

one people/nation (satu bangsa), 41 

one unifying language (bahasa persatuan), 47 

OngKeng Yong, 192 

Onishi, Norimitsu, xlv 

Opelet microbus, 216 

Operational Command for the Restoration of 

Security and Order (Kopkamtib), 71, 75 
opium trade, 34 

orang kaya (merchant elite), 22 
orang laut (sea people), 9 
ornop. See nongovernmental organizations 
Organization of the Islamic Conference (OIC), 
289 

Organization of the Petroleum Exporting 

Countries (OPEC), 210, 212 
Outer Islands, 38, 79, 99, 1 15, 152-53, 157-58, 

202,314 

P4 (Guide to Realizing and Experiencing the 

Pancasila), 75 
Pacific Ocean, 128,312 
Pacific TV, 220 

Padang, 101; earthquake (2009), 279 
Padri Wars (1821-37), 33 



Paiton, 221 

Pakpahan, Muchtar, 196 
Pakpak, 140 
Pakualaman, 27, 30, 44 
Pakubuwana II, 27 
Palakka, Arung, 24 

Palapa (communications satellites), 15, 219— 
20 

Palembang, 8, 16 

Palestinians, 229 

Pallava script, 8, 9 

palm-oil plantations, 104, 199-201 

Panca Holding, 169 

Pancasila (five principles), xliii, xliv, lv-lvi, 
52-53, 65, 74, 76, 84, 98, 1 10, 1 17, 125, 227, 
23 1, 233, 260-62, 266; constitution and, 260; 
democracy and, 316; indoctrination in, 75, 
151, 261-62, 330; Pancasila Democracy, 74, 
256; Pancasila Youth (Pemuda Pancasila), 
281; political parties and, 263, 272 

Pangandaran, 279 

panglima (commander), 350 

pangreh praja (rulers of the realm), 36, 38, 
41-43,51 

Paniai, 327 

panitia kerja (working committee — panja), 
237 

panitia khusus (special committee — pansus), 

237 
Panji tales, 15 

Panwaslu. See Election Oversight Commis- 
sion 
paper, 168 

Papua, hi, 19, 34, 46, 52, 86, 99, 103, 128, 156, 
158, 159-60, 214, 219, 249-53, 296, 300, 
326-28, 352; armed forces on, 343, 344; for- 
estry on, 204; languages and people on, 81, 
128, 147-48, 149, 214, 250, 252; migration 
and, 113; natural resources on, 184, 212, 252; 
and separatism on, 106-7, 310, 317, 326, 357; 
religion on, 122 

Papua Barat, 99, 122, 158, 206, 212, 219, 
252-53, 326, 328, 346 

Papua New Guinea, 99, 253, 296-98, 327, 352 

Papuan People's Council (MRP), 252-53 

Paramadina Foundation, 90 

Paregreg War (1401-5), 16 

Paris International Conference on Cambodia, 
Final Act of the (October 23, 1991), 292 

Parkindo. See Indonesian Christian Party 

Partai Gerindra. See Gerindra Party 

Partai Golkar. See Golkar Party 



428 



Index 



Partai Katolik. See Catholic Party 
Partindo. See Indonesian Party 
Party of the Masses (Partai Murba), 266 
Pasai, 15 

pasca sarjana (postgraduate degree), 155 

Pasisir, 16, 26-27 

Pasuruan,216, 284 

Patek, Umar, lvii 

Pearl Harbor, 41, 49 

peci (black felt cap), 129 

Pekanbaru Air Base, 349 

pembangunan (economic development), 72 

pemuda (young men), 52, 53, 55-56 

Pemuda Pancasila, 281 

penghulu (headman), 141 

People's Conscience Party (Hanura Party), 
256, 268, 278, 280 

People's Consultative Assembly (MPR), liv, 
74, 87, 88, 179, 234-35, 240-41, 257, 271, 
274, 276, 364; elections for, 255; and presi- 
dent's role, 227 

Peoples' Council (Volksraad), 38 

People's Representative Council (DPR), liv, 
74, 117, 180, 234-41, 244-47, 254, 255-56, 
257, 263, 264, 272, 274, 276, 278-79, 318, 
320, 333 

People's Republic of China. See China, Peo- 
ple's Republic of 

People's Security Forces (BKR), 312 

peranakan (native-born Chinese with some 
Indonesian ancestry), 149 

Perbuddhi (Perhimpunan Buddhis Indonesia), 
125 

pergerakan (movement for freedom from 
Dutch rule), 45 

Perhimpunan Indonesia (Indonesian Associa- 
tion), 47 

perjuangan (the struggle), 313 

Permesta, 64-65, 234, 259, 314 

Persatuan Perjuangan. See Struggle Coalition 

perserikatan (associations), 116 

Pertamina (State Oil and Gas Mining Company, 
or State Oil Company), 79, 169, 173, 21 1-12 

Perwakilan Umat Buddha Indonesia (Walubi), 
126 

pesantren (Islamic school), 120, 153-54, 259 
Petition of 50 (1980), 76 
Petrus (mysterious killings, or shootings, cam- 
paign), 317 
Pham Van Dong, 292 

Philippines, the, 1, lii, 1 1, 50, 61, 78, 158, 161, 
219, 291, 312, 346; relations with, 300-301 



Phnom Penh, 292 

Piagam Jakarta. See Jakarta Charter 
Pikiran Rakyat, 287 
Piper nigrum (black pepper), 19, 22 
piracy, 345 

pisis or picis (Chinese copper and lead coins), 
16 

plantations, 57, 198; coffee, 30; land in, 198; 

palm-oil, 104, 199-201; rubber, 37; sugar, 30 
Playboy, 281 

plywood exports, 173, 189, 205 
poaching, 202, 345 
Polda Metrojaya, 355 

police. See National Police of Indonesia 
(Polri) 

political culture, 253-62, 282-84 
Political Intelligence Service (PID), 45 
Political Manifesto (Manipol), 65 
political parties (see also under individual par- 
ties), 254-56, 263-75; and finance, 278 
polling, xlviii 

pollution, 104-5, 107, 111, 148, 161,216 

Polonia,219 

polygamy, 1 10 

pondok pesantren (traditional boarding schools), 
117 

Pontianak, 148 

population, 62, 107-9, 132, 229; and birthrate, 
107; density, 97, 109; growth, 107-8, 192-93; 
and life expectancy, 107; projected, 108; rural, 
111,113-14, 132; urban, 111-13 

Port Moresby, 297 

ports, 217-18 

Portugal, 82, 295, 321; early involvement of, 

18, 19-22, 122 
Portuguese Timor {see also East Timor), 53, 

295 

Poso, 284-85, 328-29 

postal services, 219 

posyandu (service post or posts), 157 

poverty, lii, 77-79, 85, 111, 159, 174, 176, 

197, 221,326 
Prambanan, 9, 1 1 
Prambors, 220 
Prapanca, Mpu, 15 
Prawiranegara, Syafruddin, 64 
prehistory, 3-6 

Presidential Advisory Council, 243 
Priangan, 130 

pribumi (indigene), 115, 166, 167, 173, 215, 

260, 266 
prisons, 362-63 



429 



Indonesia: A Country Study 



priyayi (Javanese elite), 36, 41-44, 51, 258; 

Serikat Priyayi (Priyayi Association), 42 
propinsi (province), 235, 241-^9 
Prosperous Justice Party (PKS), lv, 255-56, 

263, 273-75, 278 
Protestantism, 121, 122, 144 
Provisional People's Consultative Assembly 

(MPR(S)), 72 
P. T. Freeport-Indonesia. See Freeport-McMoRan 

Copper and Gold 
P. T. PAL, 333, 337, 347 
P. T. Pindad, 337 
public opinion, xlviii, liv, lvii, lviii 
Pulau Batek (Fatu Sinai), 105 
pungutan liar (pungli; illegal levies), 359 
puppetry, liii, 15, 124, 136 
puputan (ritual suicides), 34 
Puranas (Sanskrit cosmogonic histories), 123 
Purwokerto, 158 
pusaka (sacred heirlooms), 258 
puskesmas (community health centers), 157- 

59 

qiyas (reasoning through analogy), 120 
Quran, 120-21, 136, 153 
Quranic study groups, 273 

racism, 39^11, 46-47, 117 
radio stations, 220, 287 
Raffles, Thomas Stamford, 29-30 
railroads, 216-17 
rainfall, 102-3 

Rais, Amien, 270-71, 278, 280, 286, 298 

Rajasanagara (Hayam Wuruk), 14 

Rajawali Citra Televisi Indonesia (RCTI; Hawk 

Television), 220, 287 
rakai or rakryan (leaders of local communities 

in Mataram), 9 
rakyat (the people), 285 
Ramadan, liv, lviii, 98 

Ramayana (Rama's Journey, or The Travels 

of Rama), 124 
Ramos, Fidel, 301 
Ranai Air Base, 349 
rarabuku (family), 142 
Ratu Adil (just king), 31 
Red Haji. See Mohamad Misbach 
Reform Star Party (PBR), 255-56, 273 
reformasi, xli, xliv, 86-90, 111, 270-72, 280, 

283,286,319 
Reformasi Bloc, 274 

refugees. See internally displaced persons 



regency, regencies (kabupaten), 1 12, 247-48 
regents (bupati), 185, 228, 247-48, 251 
region (daerah), 184, 247 
"regional autonomy policy," 247 
Regional People's Representative Council 

(DPRD), 246, 248^19, 276-77 
Regional Police (Polda), 355-56 
Regional Representative Council (DPD), 228, 

234, 238-41,246, 276-77 
Reid, Anthony, 60 

religion (agama), 66, 68, 1 18-26, 240, 281 
religious courts, 245 
religious tensions, xl, 83, 118, 328-29 
Rendra, W. S., liii 

Rencana Pembangunan Lima Tahun. See Repe- 
lita 

Renville Agreement (1948), 57 

Repelita (five-year plan), 77, 79, 180 

Repelita I (1969-73), 157, 166, 180 

Repelita V (1989-93), 79, 180 

Repelita VI (1994-98), 180 

Republic of Indonesia, 60 

Republic of Indonesia Institute for Higher Edu- 
cation (BPTRT), 156 

Republic of Korea (South Korea). See Korea, 
Republic of 

Republic of South Maluku (RMS), 60, 234, 
314 

Research in Motion, lv 
Revolution. See National Revolution 
Revolutionary Council, 69, 70 
Revolutionary Front for an Independent East 

Timor (Fretilin), 82, 295-96, 316, 321 
Revolutionary Government of the Republic of 

Indonesia (PRRI), 65, 234, 259 
Rhenish Mission, 122 
Riantiarno, Nobertus (Nano), 85 
Riau (see also Kepulauan Riau Province), 

1 13, 140, 148, 206, 217, 298, 349 
Riau Archipelago (or Riau Islands), 207 
rice, 34, 61, 68, 129, 138, 139, 142, 146, 198- 

99; harvest, 133; price of, 198; planting, 203; 

self-sufficiency in, 83 
Ritz-Carlton Hotel, Jakarta, 1, 281 
Riyanto, Bibit Samad, xlvii 
roads, 215-16 
Robison, Richard, 1 15 
Rodgers, Susan, 140 

Roman Catholic Church, 82, 121-23, 146, 147 
romusha (manual workers), 50-5 1 
ronda malam (night watch), 133 
Roosa, John, lvi 



430 



Index 



Roti, 122 

Round Table Agreement (1949), 59, 61 
Round Table Conference (1949), 59, 80 
Royal Dutch Company for Exploration of 

Petroleum Reserves in the Netherlands Indies, 

211 

Royal Dutch Shell, 211 

Royal Netherlands Indies Army (KNIL), 33, 
49,312 

rubber, 61, 201; export of, 199; plantations, 37 
Rukmana, Siti Hardiyanti. See Suharto, Tutut 
rukun kampung (village mutual assistance asso- 
ciation), 132 
rukun tetangga (neighborhood association), 
132 

rupiah (Rp), xl, lix, 85, 168, 172, 174-76, 186- 
88, 189 

Russia (see also Soviet Union), xl, 293, 337, 
347 

rural life, 133, 195, 198, 209,358 
rust en orde (tranquility and order), 33 

Sabah (formerly North Borneo), 291, 300 

sabar (patient), 151 

Sabirin, Syahril, 179 

Sahilatua, Franky, lx 

Sahul Shelf, 4, 99 

Sailendra, 9 

Salafism, 119 

Salim Group, 168 

Samanhudi, 43 

Sambas District, 284, 328 

Sampit, 328 

sandalwood, 82, 321 

Sang Hyang Adi Buddha, 126 

Sanghyang Kamahayanikan, 123 

Sangiran, 4 

sanitation, 161 

Sanjaya, 9, 12 

Sanskrit, 7-8, 124 

Santa Cruz Massacre (1991), 82, 304, 322 
santri (orthodox Muslims), 120, 136, 259, 271 
Sape Strait, 102 
Sarasamuccaya, 123 

Sarekat Dagang Islam (Islamic Trade Associa- 
tion), 43 

Sarekat Islam (Islamic Association), 43, 45 
sarjana (academic degree), 55-56 
saroan (village work group), 143 
sate (small pieces of meat roasted on a skewer), 
129 

Satelindo, 220 



Saudi Arabia, 119 
sawah (wetland, irrigated), 198 
Sawito Affair, 76 
Schneebaum, Tobias, 147 
School for Training Native Doctors (STOVIA), 
42-43, 44 

School for Training Native Government Offi- 
cials (OSVIA), 42-43 

schools (see also education), 42, 44, 48, 117, 
120, 150-54 

Sea and Air Police, 356 

Security Disturbance Movement (GPK), 316 

sekolah desa (vernacular village primary 
schools), 42 

Selamat Pagi Indonesia (Good Morning Indo- 
nesia, TV program), 130 

Selat Malaka. See Strait of Malacca 

selendang (item of attire), 129 

semangat (charisma), 1 1 

Semarang, 45, 216, 217, 347, 357 

Semaun, 43 

Sembiring, Tifatul, xlix, 1, lv 
Sen, Krishna, 116 

Senate. See Regional Representative Council 
September 30 Movement. See Gestapu 
Seputar Indonesia (Around Indonesia, TV pro- 
gram), 130 
Seram, 98 

Serikat Priyayi (Priyayi Association), 42 
Sertifikat Bank Indonesia (SBI), 186, 188 
service sector, 165, 196, 214-15 
shadow puppet theater (wayang kulit), 136 
sharia (syariah in Indonesian), lviii, 39, 65, 90, 

120-21, 141, 153, 227, 358; in Aceh, 1, li, 

lviii, 326 
Shastri, Pandit, 123 
Shell, 211 

Shia, Shiite, 118-19 
shipping, 217-19 
Shivaist Hinduism, 9 

Shudra (commoner-servant, sudra in Indone- 
sian), 124, 137 

Siam (see also Thailand), 40 

Sidoarjo mud volcano. See Lumpur Sidoarjo 
(Lusi) mud volcano 

SIJORI (Singapore, Johor, Riau), 298 

Siliwangi Division, 58 

Simalungun, 140 

Sinai Peninsula, 352 

Sinar Indonesia Baru, 288 

sinetron (television drama or dramas), 130 



431 



Indonesia: A Country Study 



Singapore, liii, 50, 68, 101, 158, 174, 216, 217, 
219, 279, 294, 301, 329, 336, 363; exports 
to, 191, 299; relations with, 105, 191, 207, 
298-99, 346, 349 

Singhasari, 12, 14 

sini or sana (here or there), 46-47 

Sipadan Islands, 105 

Siti Hardiyanti Rukmana. See Suharto, Tutut 
Siti Hediati Hariyadi. See Suharto, Titiek 
Situbondo, 117 

slametan (religious feast), 136 
slave trade, 34, 142 
smuggling, 64, 345-46 
Sneevliet, Hendrik, 43 

social class and status, 40-42, 46, 48, 51, 60, 

83, 84, 1 14-15; and language, 134, 136 
Socialist Republic of Vietnam. See Vietnam 
Solo. See Surakarta 
Somalia, 352 
Sonara, 220 
Soputan, 99 

South China Sea, 212, 293, 299, 335, 349 

South Korea. See Korea, Republic of 

Soviet Union (USSR; see also Russia), 83, 

248, 284, 302, 335; relations with, 67-68, 

354 

Spain, colonial relations with, 21 
special committee (panitia khusus or pansus), 
237 

Special Region of Aceh. See Aceh, Special 
Region of 

Special Region of Nanggru. See Nanggroe 
Aceh Darussalam; Aceh, Special Region of 

Special Region of Yogyakarta. See Yogya- 
karta 

specialized agencies, 243 
spice trade, 16, 18,21,24,35 
Spratly Islands, 293, 335 
Sri Lanka, 7 
Srivijaya, 8-12 

Standard- Vacuum Oil Company (Stanvac), 
211 

Standard and Poor's, lix 
Star and Moon Party (PBB), 278, 281 
State Institute for Islamic Religion (IAIN), 
156 

State Muslim University (UTN), 156 

State Oil and Natural Gas Mining Company 

(Pertamina; State Oil Company), 79, 169, 173, 

211-12 

"straighten out history" {menyelusuri sejarah), 
4 



Strait of Malacca (Selat Melaka), 9, 105, 139, 
303, 346 

Struggle Coalition (Persatuan Perjuangan), 56 

Suara Merdeka, 287 

subak (agricultural society), 138 

subdistricts (kecamatan), 247 

Subianto, Prabowo, xlii, xlvi, 84, 242, 256, 

268, 278, 283 
subpuskesmas (health subcenters), 157 
subsidies, 90 

Sucipto, Widodo Adi, 332 
Sudan, 290 

Sudarsono, Yuwono, 320 
Sudharmono, 265 
Sudirman, 84,313 
Sudirohusodo, Wahidin, 43 
Sudrajat, Edi, 266, 322, 330 
Suez Canal, 352 
Sufism, 121 
sugar, 30, 34, 199 
SugarAct(1870),38 

Suharto (see also New Order), li, xli, xlii, xliv, 
lvi, lxi, 69-76, 83-89, 1 10-1 1, 120, 150, 165, 
176, 196, 206-7, 211, 227, 231, 241, 258, 
266-67, 284, 309-10, 315-19; and armed 
forces, 330, 337; and ASEAN, 289-95; and 
corruption, 79, 84, 150, 167, 169, 173, 179, 
270, 287, 309, 318; foreign policy under, 229, 
290-93, 300-302; and Golkar, 265-66; as 
"Indonesia's Best President," lvii; as "national 
hero," lvi— lvii; and Pancasila, 261; and vio- 
lence, 118 
Suharto, Sigit Harjoyudanto, 169 
Suharto, Titiek (Siti Hediati Hariyadi), 84 
Suharto, Tommy (Hutomo Mandala Putra), 

79, 174, 176 
Suharto, Tutut (Siti Hardiyanti Rukmana), 79, 
84 

suicide bombing (see also terrorism), lvii 
Sujatmiko, Budiman, 254 
Sukabumi, 357 
Sukadana, 25 

Sukardi, Laksamana, 179, 267 

Sukarno (see also Guided Democracy, Old 
Order), xxxix, xli, lvi, 54-56, 58, 63-72, 73, 
75, 80, 124, 166, 227, 231,241,288, 291,312- 
15; and Dutch colonial government, 46-48, 
247; exiled, 48, 72; and Japanese occupation, 
51-53, 54; and Pancasila, 52-53, 260-61, 266; 
and politics, 64, 259, 266; powers of, 32 

Sukarno-Hatta International Airport, 216, 219 



432 



Index 



Sukarnoputri. Megawati, xlii. 177, 241^42, 250- 
5 1 , 255. 266-67. 270. 272; and 2004 elections, 
278; and 2009 elections, xxxix, xlvi, 256; as 
president, 182, 252, 287, 324; as vice presi- 
dent. 87. 179. 297 

suku (female lineage unit). 141 

Sulaiman. Sultan, of Lamreh, 16 

Sulawesi. 64. 86. 99. 142-43. 192. 201. 215. 
303, 346: Christianity on, 122; colonial era on, 
32, 49; early records of, 8, 12, 14, 21, 30; sepa- 
ratist movements on, 64-65, 314; urbanization 
on. Ill: violence on. 117. 118. 227; volcanic 
activity on, Ix, 99 

Sulawesi Barat, 142 

Sulawesi Sea (Celebes Sea), 105, 346 

Sulawesi Selatan. 124. 142. 156. 194. 234, 266 

Sulawesi Tengah. 122. 124. 142. 281. 284. 
324. 328, 357 

Sulawesi Tenggara, 158. 214 

Sulawesi Utara. 99. 122 

Sulu Sea. 303. 346 

Sumatera Barat. In. Ix, 101. 140-41. 212 

Sumatera Selatan. 8. 206. 212 

Sumatera Utara, 99, 122 

Sumatra {see also Aceh, Special Region of), 64, 
99. 158. 160. 192. 329: agriculture on. 199. 
201; colonial era on, 33, 49-50, 54-56; early 
records of. 8-12. 14-16: emironmental prob- 
lems oil 205. 279; fishing on, 202; Hinduism 
and, 124; migration and. 112: oil production 
on, 49. 211-12; peoples on, 139-42; separatist 
movements on, 64-65, 3 14; transport on, 215, 
217-19; tsunamis and earthquakes on. 101. 
139 

Sumba. 117. 145^6 

Sumbawa. 101. 137 

Sun Television (SCTX). 220. 287 

Sunata, Abdullah. 1 

Sunda. 14. 130 

Sunda Kelapa. 24 

Sunda Shelf. 4. 99 

Sunda Strait. 102 

Sundanese people and language. 128. 130 
sunna (Islamic custom). 118. 120 
Sunni. 117. 118-19 

Supersemar (Letter of Instruction of May 11), 
72 

Supreme Advisory Council, 243 
Supreme Court, li. lv. lvii, 235, 238, 244-45, 
287, 358, 362 



Surabaya, 12, 25, 45, 48, 55, 194, 206, 220, 
343, 347; Stock Exchange, 172; transport 
links. 217, 219 

Surakarta (Solo), 27, 29, 30, 58, 132, 216 

Suriname, 56 

Surya Citra Televisi (SCTV), 287 
Suryajaya, William (Tjia Kian Liong), 170 
Suryaningrat, Raden Mas Suwardi (Ki Hajar 

Dewantara), 44-45, 48 
Suryaputra, Raden Mas Sonder, 44-45 
Sutarjo Petition (1936), 48 
Sutarto. Endriartono, 332 
"Sutasoma," 15, 132 
Sutomo. Dr.. 46 
Sutowo, Ibnu, 79 
Swaragama (radio station), 220 
Sweden, 324 
Switzerland, lix, 44 

Syahrir, Sutan, lx, 47, 48, 51, 53, 57, 58 
syariah. See sharia 
Syria, 6 

Syzygium aromaticum, 19 

Tabanan, 34 

Tabuni, Buchtar, 107 

Taiwan, lix, 174, 191, 204, 207, 212 

TamanMini, 131 

Taman Siswa (Student Garden; schools), 44, 
48 

Tambunan, Gayus Halomoan, liv 
Tamil. 12 

TanMalaka,45, 56, 59 
Tanah Merah (Red Earth), 46 
Tanaka Kakuei, 302 
Tangerang, 112, 194 
Tangguh natural gas field, 212 
Tanjung, Akbar, 265-66 
Tanjung Perak, 217 
Tanjung Priok. 2 1 7 
Tanjung Priok riots (1984), 76 
Tantular, Mpu, 15. 132 
Tarakan, 49 
Taruma. 8 

Tasikmalaya, 117, 279, 284 
Tasikmalaya earthquake (2009), 279 
Taxation Review Board, 245^6 
taxes, 9. 30, 61. 80, 178, 240, 248; oil, 181; rev- 
enues from, 182-83, 184-85, 186 
tea, 34 
teak, 26 

Technical College, Bandung, 46 
tegalan (rain-fed agricultural land), 199 



433 



Indonesia: A Country Study 



telecommunications, 219-20, 298 

telenovelas, xlv 

telephones, 220, 296 

television, xxxix, xlv, 130, 220, 278, 287 

Television of the Republic of Indonesia (TVRI), 

220, 287 
Telkomsel, 298 
Tembagapura, 214, 327 
Tempo, xlviii, 282, 287-88 
Tenggerese, 124 

Tentena, 284 , 

Temate, 17, 18, 20-21,24 

Terror of the Universe, 22 

terrorism, xl, 1, lvii, 227, 280-81, 290, 310, 

317, 329-30, 346, 356-57; and "global war 

on terrorism," 88, 290, 301; and international 

links, 303, 324, 354, 364 
textiles and garment industry, 165, 168, 189, 

193, 194 

Thailand, liii, 8, 14, 51, 78, 101, 161, 165, 174, 

336, 363; relations with, 204, 292 
Theravada Buddhism, 126 
Tibet, 9 
Tidore, 20-21 
time zones, 103^4 

Tjia Kian Liong. See Suryajaya, William 
Timor (automobile), 174 
Timor (island), 34, 99, 105, 122, 128, 321 
Timor Gap, 105 

Timor-Leste {see also East Timor), 82, 86, 99, 
105-6, 158, 291, 295-96, 300; annexed by 
Indonesia, xl; relations with, 229, 296; and 
struggle for independence, 249, 323; and the 
United Nations (UN), 105-6 

Timor Timur Province, 82, 229, 249, 276, 
295,310,317 

Timorese National Council, 323 

Timorese Popular Democratic Association 
(Apodeti), 82 

tin mining, 212, 214 

Tiongha, 148 

Tiro, Hasan di, liii, 81, 250, 324 
Tirta, Iwan, lx 

Tirtoadisuryo, Raden Mas, 42^43 
TNI Command and Staff College (Sesko TNI), 
343 

TNI Command and Staff School (Mako Sesko), 
343 

Toba Batak, 122, 140 
tobacco, 34, 206 
toko (stores), 129 
Tokyo, 5 1 



Tolitoli, Manado, 45 

tongkonan (ancestral house), 143 

Top, Noordin Muhammad, 1 

Toraja people and lands, 124, 142-43 

Total People's Defense (Hankamrata), 334-35 

totok (full-blooded), 40, 149 

tourism, 137, 142 

Toyota, 209 

trade: barriers, 168-69, 172; earliest, 5-7, 8; 
exports, 64, 174, 180, 186-89, 191-92, 199- 
201, 206, 210-12; imports, 61-62, 168-69, 
189,191-92,211 

trade unions, 196 

Tralaya, 16 

Trans 7, 220 

Transmigration Program, 1 12, 205, 327, 328 

transportation infrastructure, 215-19 

Treaty of Amity and Cooperation in Southeast 
Asia (TAC; 1976), 293-94, 297, 301 

Treaty of Giyanti (1755), 27 

Treaty of Mutual Respect, Cooperation, and 
Friendship (1986), 297 

Treaty on the Southeast Asia Nuclear Weapon- 
Free Zone (1997), 294 

Trenggana, 18 

Tridharma Buddhism, 126 

Trihatmojo, Bambang, 169, 176 

Trisakti University, 85, 89, 1 17 

trisandhya (Hindu daily prayer), 124 

Trowulan, 15, 16 

Trunajaya, Raden, 26 

tsunamis, 101; in 2004, 89, 101, 106, 215, 251, 

279, 311; in 2006, 279 
Tual, 346 
Tuban, 49 
Tuhan, 119-20 
Tur, Pramudya Ananta, 41, 84 
Turkey, 40 
Twist, the (dance), 66 
Twitter, xlviii, xlix 

Ugi ethnicity, 130 
Ujungpandang. See Makassar 
uleebalang (hereditary district chiefs), 22, 33 
ummah (community of believers), 17, 121, 136, 
258 

unemployment and underemployment, 156, 

180, 193-94, 221,326,359 
Unit 81, 330 

United Development Party. See Development 

Unity Party 
United East Indies Company (VOC), 22-29 



434 



Index 



"United Indonesia" cabinet, 242 

United Kingdom. See Britain 

United Nations (UN), xliii, 54, 57, 80-82, 86, 
321, 323; General Assembly, 290; member- 
ship in, 66, 68, 72; peacekeeping forces, 290, 
296, 303, 318, 350-51; Security Council, 58, 
68, 292, 294 

United Nations Children's Fund (UNICEF), 
156 

United Nations Climate Change Conference in 
Bah (December 2007), 304 

United Nations Convention on the Law of the 
Sea (1982), 288 

United Nations Development Programme 
(UNDP), 115, 197 

United Nations Educational Scientific, and 
Cultural Organization (UNESCO), liii 

United Nations Security Council Resolution 
1747, 229,304 

United Nations Temporary Executive Author- 
ity, 252 

United Nations Transitional Administration in 
East Timor (UNTAET), 106, 296, 323 

United Nations Transitional Authority in 
Cambodia (UNTAC), 292, 335 

United States Agency for International Devel- 
opment, 159 

United States Central Intelligence Agency, hv, 
69,70 

United States Committee for Refugees, 118 

United States Congress, 304 

United States Department of State, 124; Coun- 
try Reports on Human Rights Practices, 362 

United States Drug Enforcement Administra- 
tion. 363 

United States Foreign Military Financing (FMF), 
323, 354 

United States Foreign Military Sales (FMS), 

318,337.352,354 
United States National Defense University, 

344 

United States of America, 44, 52, 57, 58, 65, 
293. 300-301, 321, 357; aid from, 352; invest- 
ment from, 207; mihtary relations with, 310— 
1 1. 322-23, 329, 345, 347-48, 352, 354; rela- 
tions with, 67-68, 82, 88, 228-29, 303-5; 
rivalry with China, lix-lx; security coopera- 
tion with. 335, 357; trade with, 191, 304 

United States of Indonesia, 56 

United States Reserve Officers' Training Corps 
(ROTC), 338 



United States-Indonesia Society (USINDO), 
304 

United States-Indonesian Comprehensive Part- 
nership, lx 

"Unity in Diversity" (Bhinneka Tunggal Ika), 
15,222, 233 

Universal Struggle (Universal Struggle Char- 
ter— Permesta), 64-65, 234, 259 

Universitas Gadjah Mada, 156, 271 

Universitas Indonesia, lx, 73, 156, 166, 167, 
274 

Universitas Pertahanan Indonesia, 344 

Universiteit Indonesia, 156 

Universiteit van Indonesie (UVT; see also Uni- 
versiteit Indonesia), 156 

University of California at Berkeley, 166 

University of Indonesia. See Universitas Indo- 
nesia 

Upanishads (literary work), 123 
Urban and Regional Development Institute, 
111 

urban life and urbanization, 111-12, 127, 133, 

140, 148,317, 329,358-59 
Utan Kayu (enclave in Jakarta area), 282 

Vaishya (merchant-farmers, waisya in Indone- 
sian), 137 

value-added tax (VAT), 181 

Van Mook Line {see also Mook, H. J. van), 
56-58 

vanilla, 82 

vama (caste or castes), 124 
Venezuela, 78 

Vietnam, 9, 11, 14, 54, 290, 321, 334-35; 

invasion of Cambodia by, 292-93 
village (desa), 132 
Visman Commission, 40-41 
volcanoes, lx, 99, 101 
Volkman, Toby Alice, 143 
Volksraad. See Peoples' Council 
vorstenlanden (principalities), 3 1 

wages, 194-95 

Wahhabism {see also Islam), 33, 119 
Wahid, Abdurrahman (Gus Dur), h, 86, 89, 
117, 177, 179, 241^12, 250, 252, 255, 267, 
268-70, 273, 278, 280, 286, 287, 328; death 
of, liii 

Wahid, HidayatNur, 274 
Wahid, Salahuddin, 255, 278 
Wales, 101 

wall (Muslim saints), 17, 121 



435 



Indonesia: A Country Study 



Wallace's Line, 4 

wanno kalada (ancestral village), 146 

warung (food stalls), 129 

Wardhana, Ali, 167 

watak (regional chief or overlords), 1 1 

wawasan nusantara (archipelagic land and 

waters), 105, 288 
wayang (puppet performance), 15, 124 
wayang kulit (shadow puppet theater), liii, 136 
Webster University, 303 
West Irian {see also Papua) 251-52, 315 
West Irian campaign, 341 
West Irian Jaya {see also Papua), 252 
West New Guinea {see also Papua), 62, 67, 

80, 99, 251,315 
West Papua (Irian Jaya) 25 1 , 297 
West Timor {see also Nusa Tenggara Timur), 

106, 295-96, 323 
Western Fleet. See Navy of the Republic of 

Indonesia (TNI-AL) 
Weyewa, 145^6 
Wibowo, Sarwo Edhie, 81 
Wijaya, Raden (Kertarajasa), 14 
Wijoyo, Lieutenant General Agus, 330 
Wild Schools Ordinance, 48 
Wimelmina, Queen of the Netherlands, 38 
Winata, Tomy, 287 

Wirahadikusumah, Lieutenant General Agus, 
330 

Wiranto, General, xlii, 242, 255-56, 268, 278, 

283,310, 323, 332 
Witular, Wimar, xxxix-xl 
Women's Army Corps, 349-50 
Women's Police Corps, 349-50, 356 
Wonosobo hoard, 1 1 

working committee (panitia kerja or panja), 
237 

World Bank, xlvii, 68, 77, 79, 114, 174, 177, 
191,289 

World Economic Forum (Davos), lix 



World Health Organization (WHO), 157, 158, 
160, 161 

World Trade Organization (WTO), 174 
World War II, 40-41, 49-53, 158, 302 
World Wildlife Fund for Nature, 106 

Yani, Ahmad, 69 
Yasadipura 1, 29 
Yasadipura II, 29 
yayasan (foundation), 1 16 
"A Year of Living Dangerously" (1965), 288 
Yijing, 9 

Yogyakarta, 9, 27, 29, 30-31, 58-59, 132, 156, 
157, 220, 313, 343; Special Region of, 101, 
194, 206, 247, 249; earthquakes and volca- 
noes and, fx, 279; transport links of, 216-19 

Young Java (Jong Java), 44 

Young Sumatrans' Association (Jong Suma- 
tranen Bond), 44 

Youth Congress, Second (October 1928), 47 

Youth Pledge (Sumpah Pemuda; Youth Oath), 
47, 57 

Yuan Dynasty, 14 

Yudhoyono, Susilo Bambang, xlvii, hi, 89, 179, 
221, 241^13, 257, 303^, 310; and armed 
forces, 320; and counterterrorism, 329; and 
domestic policies, xliv, xlvi, xlix, 1, liv, lix, 
227-28, 251, 255-56, 262, 283, 325; and elec- 
tion campaigns, xxxix, xlii, 255, 267-68, 270, 
278; and foreign policy, 290 

Yudohusodo, Siswono, 278 

Yugoslavia, 248, 284 

Yusuf, Irwandi, 251,282 

Zaire. See Congo, Democratic Republic of 
Zheng He, 16 

Zone of Peace, Freedom, and Neutrality (ZOP- 
FAN), 293 



436 



Contributors 



William H. Frederick is Associate Professor of History, Department of 
History, Ohio University, Athens, Ohio. 

John B. Haseman is a retired U.S. Army colonel, former U.S. Defense 
Attache in Jakarta, and now a consultant and writer. 

Blair A. King is a foreign service officer at the U.S. Agency for International 
Development. 

Joel C. Kuipers is Associate Professor of Anthropology, Department of 
Anthropology, The George Washington University, Washington DC. 

J. Thomas Lindblad is Associate Professor in Economic History and the 
History of Indonesia, University of Leiden, The Netherlands. 

Robert L. Worden is retired chief of and now consultant to the Federal 
Research Division, Library of Congress, Washington, DC. 



437 



Published Country Studies 
(Area Handbook Series) 



Afghanistan 

Albania 

Algeria 

Angola 

Argentina 

Armenia, Azerbaijan, 

and Georgia 
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Austria 
Bangladesh 

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Congo 
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Coast) 
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and Haiti 
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India 

Indian Ocean 

Indonesia 

Iran 



439 



Iraq 

Israel 

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Yemens, The 

Yugoslavia 

Zaire 

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440 GSO' U S " GOVERNMENT PRINTING OFFICE : 2012— 373-677 



ISBN 978-0-8444-0790-6 




